RCH richfield group limited

why the directors are raving about this

  1. 1,057 Posts.

    I thought it was the super high average grade that was goosing them into fits of delirium. I mean after adjusting for assay errors, we could have 106Mt at the unbelievable 0.2%MoS2. I assumed until I studied the canadian producer that you would blend the ore so you have a constant grade.

    Not so lads, not so. The old Moly gang rip out the high grade stuff first if they can get to it (ie underground mine you cannot necessarily get the high grade stuff out first).

    Now go back to the shocker of a presentation and have a look at Santos open pit numbers and what do you see? Yep 19.97Mt at 0.29% MoS2. Now running that grade through my 7.2M mill size feasibility study model an I get a Net Profit before tax of $580M for the first 2 years and year 3 you get a blend with low grade material. Now that pays off the whole project in year 1.

    Can it get any better? Well yes, I'm using a Moly price of $20lb. The current Moly price is $34lb. Stick that into the feasibility model and you get $1Billion (yes a billion) net profit year 1 and year 2 assuming the price stays at $US34lb.

    Ha ha, suck on that
 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.