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I say things on Twitter

1/3/18

SolGold (SOLG.L) (SOLG.to): Here's how I put it...

...to a mailpal who asked for a thought or two on the Maiden Resource Estimate out of the company today (NR here). The only thing I forgot to add was my throughput assumption of 80,000tpd, but he knew that one already. Mail reproduced verbatim.

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The 120mt high grade gives 4 years of feed.

Assuming reasonable things ($3/lb copper price, 85% overall recoveries incl gold portion which will be lower than copper recovery), the 1.8% CuEq core gives "rock worth" of U$101.2/tonne....let's call it a hundred.

Therefore, that high grade core is worth U$12Bn.

Capex estimate $5Bn. Overall margin estimate 50%.

The capex is paid by the hi grade with a billion to spare in less than four years. Then the rest is gravy, and we're talking literally decades of gravy, even without the next porphyry drilled at Cascabel.

This is a solid maiden resource.
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