In answer to your question as to how I estimate AISC once the service shaft is fully commissioned.
I estimate the ore tonnage per quarter at 204kt. I accept that this is at the upper capacity bound and may well not be achievable in practice because of the need to still haul a percentage of waste.
Diluted head grade at 7.2 g/t and recovery at 94%. Thus c. 44.4koz/qtr.
Cash costs at US$439/oz (just using the latest actuals). So US$19.5m/qtr.
Ongoing sustaining costs of: Exploration at US$2m, Capital works at US$2.1m, Development at US$7.4m and Corporate at US$1.5m.
Therefore total quarterly sustaining costs of c. US$32.5m.
Divided by production of 44.4koz = US$732/oz.
If we allow for 10% of haulage capacity to be used for ongoing waste then production drops to c. 40koz/qtr and AISC rises to c. US$812/oz. But I have no idea as to how much waste will need hauling once the mine improvement initiatives are completed. I would have thought that 10% is on the high side given that most development is carried out within ore and that they try and use waste as infill whenever possible.
All the above is just an opinion of course!
Thank you for the chart of Ev/FCF. Most interesting!
CPDLC
MML Price at posting:
43.0¢ Sentiment: Buy Disclosure: Held
