GREY:NEVDQ - Post by User
Comment by
RockDoc1on Nov 14, 2021 1:34pm
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Post# 34124850
RE:NGU = could you look at your calculations
RE:NGU = could you look at your calculations The assumptions are not realistic. We don't get paid for metal in the ground. We get paid a net smelter return after all costs, including refining.
Some problematic assumptions:
- Orebody Grade. The orebody grade is not 2%. The grade of the mining reserve is 1.85%. Including the current resource estimate, the grade is 1.59%. This is a 10% to 25% reduction in revenue.
- Concentrator Recovery. The concentator recovery is currently 85%, not 90%. This is a 5% reduction in revenue.
- Waste Dilution in Mining. Waste dilution is hard to estimate. Most open stope mines, waste dilution is 10% to 20%. Assume 15% dilution with low grade in the waste. This is a 10% to 15% reduction in revenue.
- Cost. Revenue of $2/lb over all in cost has no basis. The mining/millling/GA cost is between $43 and $53 per ton from the feasibility study. This is very optimistic. We will need a few years of data before we know the real all in cost.
- Smelter Cost. There are transportation costs, refining and smelter costs, smelter recovery, and smelter penalties. This could easily be a 10% to 15% reduction in revenue.
This all results reduces the NotGNU revenue estimate in the order of 35% to 60%, not including the currently unknown mining cost.
RockDoc