RE:PEA Valuation Proxy for Queensway Early ProductionIt's Possible to do a fairly reasonable facsimile of the upcoming HD + updated FS.
A 10 year life averaging 50,000 ounces per year or somewhere mine shorter life if they high grade the first several years .
This assumes including Orion and Stoger and the two deposits continous with HD and no other gold or gold copper discoveries ( extremely unlikely )
DPM Project is an gold underground mine in Serbia with current resources of 1.6 m ounces, producing 1.3 million ounces over 10 years at an average grade of 5.8 grams per ton.
Note that the NPV 5% discounted after tax is $941 million US = $1.25 billion in CAD.
Note Very Low AISC of just $715 US per ounce .
Replace Serbia underground mine with a HD+ open pit mine with average grades of 4.7 grams per ton and 50,000 ounces of gold for a 10 year mine life .
Ie, Prorata , the after tax NPV 5 at $2100 POG would be 40% of $1.25 billion which is about $500 m in CAD.
But, DPM has an initial mine building capex of $381 million US versus $40 M US for HD+ ( Macs public statement ).
This is a gain of $340 million US for the HD+ after tax NPV , as that $381 million is removed from the DPM NPV .
So, excluding that $340 million US in mine capex for the Serbian mine from the HD NPV......a very conservative after tax NPV5 for the updated HD+ mine is easily $500 million cad.
AISC is likely to be between $500 to $600 US per ounce..
GLTA