Ann: Adriatic Metals Corporate Presentation, page-323

For convenience, all my metal equivalent values are reported gross. However, revenues from my model have always been reported as NSR.

My NSR per tonne estimates are roughly 60-65% of GMV. Please see my math below.




I assume 51% Zn con. Therefore, we can calculate gross value @ US$1/lb Zn:

51% * 2204.62 lbs/t * US$1/lb Zn = US$1124.36/t of Zn Con

Then take 8% unit deduction (8% 0f 51% Zn) at smelter leaving 43% Zn:

51% Zn - 8% Zn unit deduction = 43% Zn

Said differently, 84.3% of the Zn in concentrate is "payable":

43% Zn / 51% Zn = 84.3% of Zn payable

Revenue per tonne of Zn con after unit deduction:

84.3% payable * US$1124.36/t = US$947.83/t

Then subtract US$140/t treatment charge to get NSR/t Zn Con:

US$947.83 - US$140/t = US$807.83/t Zn Con



If head grade is 10% Zn, it would take 5.67 tonnes of feed to concentrate Zn to 51%:

51%/(10% Zn * 90% recovery) = 5.67 tonnes mined per tonne of Zn con

Therefore, Zinc NSR per mined tonne is US$142.47:

US$807.83 ÷ 5.67 tonnes = US$142.47/t mined

This is roughly 65% of GMV of 10% Zn @ US$1/lb which is US$220.46/t



I do not include transport/haulage costs or account for any penalties. Another reason my my NSR values seem high (as a % of GMV) is treatment charges, which has come down to around $140/t compared to $200/t+ a few years ago. Still, I would consider my revenue models very conservative as I do not include potential revenues from barite; assume site costs on the high end for UG mining, and (as you've complained many times) conservative Au recovery assumptions.