RE:RE:RE:RE:RE:Fortune's Fortune?It's a very interesting project. Just for fun I calculated based on their current resource/reserve estimate, that there is around 4.8 billion in revenue (if they could extract all metal at 80% recovery). Over 15 year mine life that would be an average revenue of 320 million per year.
The question is, can they mine, concentrate and recover at a cost of well below 320 million per year. Based on a mining cost of 100$/t and a refining cost of 50$/t, this indicates a cost of 262.5 million / year. This leaves a profit of around 60 million / year, or 900 million over 15 years. Of course this doesn't account for capital for construction that will eat into the profit mightly. Construction costs and mine development/stripping costs will likely be North of 500 million.
That is unfortunately a pretty skinny margin given uncertainties with commodity pricing.
The NWT is a hard place to mine and do business. There are multiple layers of government agencies struggling to justify their existance and create barriers to success. The weather is harsh and the first couple of years of production will probably be challenging.
Fortune needs to increase (ideally double or triple) and reserves/resources and hand this over to a compentent miner. They don't seem to have the horsepower to bring this project to production, given their reliance on blood sucking consultants and contractors. Also what is up with the 10 year old feasibility study. This needs to be updated urgently.
Based on a 450 million share count, there is a case to be made for a 50-75 ct/share buy out if they can double the resource/reserves. If they can't increase the reserves substantially, I don't see how they can bring this project forward.
JMHO