One other relevant item from my ASL discussion.
ASL will use consensus forecasts for POS/POG for their financial studies. They get rid of the outliers both high and low and then take an average of the remaining ones. Currently this is likely to produce a POS between US45 and US$50 and POG around $3,500 or a GSR ratio of about 70-75. While ithese prices may change for USL's PFS (maybe more like to $50) these are the prices that i think USL will use. BML are using something similar for their FS study yet to come out.
At current FX rates and using an ASIC for a 10m Oz AgEq for 10 years produces an NPV (5%) of about A$3.4b for US$50 POS and at US$45 an NPV about $2.9b - USL is currently trading 0.15 and 0.18 of those NPV. The Daily Gold suggests that developers trade on an average ratio of 0.43 NPV. So we are looking at possible upside potential of 2 and maybe 3 at those POS/POG. At higher silver and gold prices the upside increases.
I expect USL to use a higher discount rate something more like 8% to 10% - but that will not change the upside potential as the 0.43 factor is based on a 5% discount rate which they use in Canada and USA. At 8% and US$50 POS the NPV reduces to about A$2.9b.
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