Maritime Resources Corp V.MAE

Updated Free Cash Flows for HD mine

[nozzpack]

Free cash flows per year for the HD mine for a range of POGs are already documented in the 2022 FS .

From such information , It is relatively simple to calculate that at 50,000 ounces the HD mine would free cash flow by an additional $12 million per year for each $300 increase in the POG.

The highest gold price used was $1900 US and at the price, the 2022 FS estimated HD free cash flow per year to be $47.1 million .

Of course , @$12 million increase for each $300 increase in the POG, HD would free cash flow $47.1 million plus $24 million = $71.1 million cad per year for 5 years .

Of course, the $45 million in capex for the Nuggett Pond upgrade and the high tech sorter won't be needed in the HD FS update , so over 5 years that savings adds $9 million per year to free cash flows.

In total , therefore, the HD mine at $2500 US POG Will free cash flow after tax and all costs about $80 million cad per year amounting to $400 million for the current mine life of HD.

That is a remarkable number, due primarily to its ultra high gold grade and virtually no capex cost for mill or infrastructure .

It can also be stated with confidence that the four satellite deposits not yet included in the HD FS and extensional drilling , will add years to the life of the HD mine.

If you assume 100 million post consolidated shares , Thats $0.80 per share in free cash flow .

Typically, as free cash flows are rather modest for the average Peer Junior producer, the free cash flow multiple is in excess of 10 times annual free cash flows.

This at just 50,000 ounces per year.

No other Junior open pit producer can come even close to such a performance because of the drag of low average grades of about 1.5 grams per ton and the high cost of building a mine..

[Zibo510]

Right on Nozzpack.  An AU open pit with 1.5 g/t  vs HD @ 4.5 g/t Has to excavate 3x the ore, truck 3x, process 3x ore and deal with 3x waste material to produce the same amount of AU as HD. This extraordinary savings is unreal, I don't believe the market is currently recognizing this, but soon will. 

[nozzpack]

You do realize that V Lake has an average grade of just 1,6 grams per ton , Lynne Lake about the same and that these grades are normal for open pits . Note also extended intercepts at much higher grades than 1.4 grams in the Pine Cove intercept. Former Pine Cove grades were about 2.5 grams and there is no reason that fully drill delineated these new discovers won't average about the same