near term production > near term production is a pipe dream
For a potential buyer the question is how far are they off.
Bulk sampling done and the development property is idle. At this point it is highly unlikely that any company could go into production from a cold start and the ramp-up phase of the PEA will be required.
Using the conventions of the PEA, year 0 corresponds to the first 6 months of the ramp-up phase. I will call the bulk sampling phase that ended in 2018 .. year -1.
Below the CCF of each year are tacked onto the shareholder equity of Sept 2018.
Sept 2018 (year -1)
shareholder equity $13.0M
CCF from the PEA
year 0 ($9.848M)
year 1 $10.715M
year 2 $13.195M
Tax-loss credits used (based on PEA numbers)
year 0 $0.871M
year 1 $3.554M
year 2 $4.201M
shareholder equity (CCF + tax loss credits)
year - 2018 $13.0M
year 0 2019 $4.0M
year 1 2020 $18.3M
year 2 2021 $35.7M
year 3 2022 $47.8M **
cash added over $13M
year - 2018 0
year 0 2019 ($9.0M)
year 1 2020 $5.3M
year 2 2021 $22.7M
year 3 2022 $34.8M **
** With pre-tax NPV of $121M over a 10 year project each additional year, eg year 3, will bring in approximately CCF $12.1M
By the end of year 3 there will be $34.8M of cash added to the current shareholder equity.
The entire Sept 2018 balance sheet is $32.9M
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Notes:
All the numbers can be found on pg 207 of the PEA available on SEDAR.
CCF is cummulative cash flow