Artemis Gold Inc V.ARTG

Final Initial Capex Number Will Be....?

[AlwaysLong683]

Recent noteworthy news from ARTG:

 

Slide Presentation June 2023, page 11:

Initial Capex Estimate for Phase One from the September 10, 2021 Feasibility Study: C$645M

 

Excerpts from the ARTG press release dated June 15, 2023:

 

"Artemis Gold announces that as a result of internal engineering analysis, it has committed to additional investments as part of its Phase 1 development of the Blackwater Mine in order to facilitate the potential fast-tracking of the Phase 2 expansion. In support of these additional investments, the Company has amended the gold stream agreement with Wheaton Precious Metals Corp. (“Wheaton”) which will provide an additional US$40 million (C$54 million) in funding at a very low cost of capital....

 

The cost of these additions, together with over-budget expenditures on permitting costs and additional bonding costs connected to those permits, will require additional funding of approximately C$50 million....

 

The initial capital to complete to first gold pour is now estimated to range between C$730 million and C$750 million...

 

While the Company believes it has captured all known inflationary impacts plus contingencies to completion to gold pour in this estimate, it will provide updates on any material changes to this estimate on a quarterly basis through to commissioning and first gold pour in H2 2024...."


My observations from the above:

Initial Capex estimate from the September 2021 Feasibility Study plus the additional expenditures for the upgrades (C$645M + C$50M):

C$695M      

Revised Initial Capex Estimate from the press release:
C$730M to C$750M

 

1) Looks like ARTG is already projecting their initial capex to be $35M to $55M over budget vs. the September 2021 Feasibility Study plus the upgrades money.

2) Any further upward revisions to this number will apparently be communicated on a quarterly basis.

As I've stated in past posts, the September 2021 Feasibility Study is outdated in my view, so I wouldn't trust the cost estimates included in that study and thus the projected profitability / return numbers presented.

[jedd11]

This Initial Capex estimate increase was anticipated and very minimal in the overall scheme of things. Every mine developer is subject to current inflationary pressures. There will be some minor impact to projected and actual profitability numbers but I would still rather own Artemis than any other current developer. It is important to note that the Revised Initial Capex Estimate range of C$730M

[metalhead666]

Artemis more than any other near term developer is going to be a cash generating machine soon...keep your eyes on Skeena..they are a year or two behind but will also be printing money

[metalhead666]

Over a 22 year mine life this means nothing.  Artemis will still be a cash generating machine. Gold will resume its bull market and the profitability will go straight up.  

[givemeabreak1]

Metalhead while Attemis will be generating cash it will not be anytime soon and no where to what you expect especially if gold continues to correct down.  There is a reason the project sat for years withought being developed.....It will likely be sometime in early 2025 before they reach commercial production!  They likely will not generate any cash until the end of 2025 and even then

[givemeabreak1]

Something I forgot to mention the recent cost update indicated over 100 million in additional lifetime sustaining cost.  Without looking it up correct me if I am wrong I believe the actual number is like 180 million so simply put that is a life of mine reduction of about the same amount of cash flow. So many things not being accounted for Mr Metal

[metalhead666]

Over 22 years that's 9 million per year. If my math is correct. 9 million out of 350 million $ free cash flow...I won't lose any sleep over it

[metalhead666]

Also...do you think the POG won't be higher in the years ahead?  If so you have no business in this space at all.  At a minimum gold will keep up with cost inflation thus rendering sustaining capital increases meaningless.  Should gold outperform inflation as I expect it will then all the better!  Free cash flow will go through the roof.

[rdy2rumble]

Metalhead the poster you are conversing with only wishes to argue. 99% of ALL givemeabreaks posts are inflammatory. Responses only encourage more nonesense. My current average on ARTG is $4.17 and I couldn't be happier. I have full intentions of adding in the coming days/weeks/months as this one is one of few that shine brightest. My target is 10,000 shares by years end if possible. Only 5500

[givemeabreak1]

Thanks for your response that was not directed at you rdy2rumble aka Pokinfun aka and so on!  You own a whoke 4500 shares you are a power in the markets lol.  Still a clown Poikin!  I actually do not mind this one!  I definately do not see it going where your other big pick went Bonterra.  What from dollars to pennies.  All the best my good friend PokinFun

[metalhead666]

I have 5000 shares now and would like 10k also.  The only way we get them cheaper is if gold takes a further tumble which I see as unlikely.  News flow from now on will only be about progress made. 30% complete... 50% complete.... 75% complete etc as we cross the finish line. 

[givemeabreak1]

metal do not get me wrong I see nothing wrong with your investment.  I only am pointing out that there are alot of costs that were not and are not in a FS hence retail investors tend to habit towards posting what is ridiculous stuff.  Unfortunately, many retail investors do not understand the actual costing of a project!

[metalhead666]

Ok. Fair enough.  I've never known a mine to come in on budget....it's the worst business in the world and I hate it...however....the group has its moments in the sun and a ton of money can be made with the right names at the right price and a bit of patience. Artemis isn't unique but compared to every other FS I've ever read there's a lot of room for errors here and still

[rdy2rumble]

Yes, also started a position in Skenna today as well.. I'd like to eventually get 5k Skenna shares with my ARTG--same time frame,, maybe a bit slower. Almost everything else is in cash.  Maybe only one other, should Victoria gold get cheap enough I'd consider buying that as well as I believe they'll have a long mine life with reasonable mining costs with gold only going higher

[givemeabreak1]

Metalhead I agree with pretty much of everything you said and as far as gold companies go this one is ranked near the top for potential for handsome returns.  That said, the highly profitable part remains to be seen as there is alot of cost being accounted for in the form of Streams which tend to make the financial picture more hazy.

[metalhead666]

Welcome to the wonderful world of mining! 

[Shadow10]

Nearing the finish line.I would say you have a year plus before Artemis is producing revenue. Skenna wouldn't be producing till 2026, it's a good one to buy low and sell high  multiple times .

[metalhead666]

You certainly can do that.  As I've said many times....gold miners are the WORST possible business anyone can enter into. BUT....it's a highly emotional place and when the group is in favor there are few speculations that can move as high as fast. Right now there's little interest but get gold back over $2000 and even the worst names will take off. If you want to "trade"

[metalhead666]

I'd add....a year before commercial production is probably THE best time to be accumulating shares. The Lassonde Curve is a great guide and should it hold you should expect the greatest appreciation in the stock between now and then. Obviously sentiment towards the group matters a lot as does the price of gold and silver but they will take off again as soon as it's obvious that the central

[metalhead666]

I'm not in any hurry are you?  The AISC from a shareholder perspective is what it is regardless of financing. If it was all through equity then there would be a bigger pie that needs to be divided amongst us shareholders....if it was all through debt then we'd have more of the pie.  Doesn't matter.  It is a free cash generating machine with a 2 year payback. All mines