OTCPK:KRCLF - Post by User
Post by
Farquaron May 26, 2022 6:28pm
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Post# 34710594
Why didn't Huet buy Lakewood mill in the first place?
Why didn't Huet buy Lakewood mill in the first place?So Krr probably spent 10 million $ cdn to bring the higginsville mill from 1.3 million t/y to 1.6 million t/yr plus they are/were to spend about 45-50 million $cdn to bring the mill from 1.6 m to 2.5 million tons/year by mid 2023 for a grand total of 60 million cdn$ to gain 1.2million t/yr of new milling capacity.. Now they are paying 80 million$ australian ($74.5 million canadian) for this mill ( $ 65 mllilon cdn in cash and 9.3 million $ cdn in shares which is about 1.937 million shares at 4.80$/share).....So they are acquiring an identical 1.2 million tons of milling capacity for 74.5 million $ cdn...This is about only 14 million$ cdn above what they were to pay to bring higginsville from 1.3 million to 2.5 million....So, 74.5 million $ cdn is a fair price to pay considering the inflationary times , plus it's 15 kms closer to beta hunt than higgy , plus it's 1.2 million capacity available practically immediately...So, this mill acquisition is a sound decision.. If they can run a 2.6 g/t net ore through it at 1850$ gold and aisc of 1000$ they will produce 100,000 gold ounces x 850$ = $85 million US gross profit ( over 100 million$ cdn ) in the first 12 months, which pays for the mill....They probably could have bought this mill for much cheaper a year ago, but that is pure speculation on my part...I think Huet was probably too focused on acquiring the jubilee mill from northern star and so maybe missed out.on a lower price on Lakewood ..jmho