@Sarg, 90 million dollars isn't "peanuts" to Toho Zinc. You previously posted that their market capitalization was $46.66 Billion however it's closer to $600 million. Their share price and market cap is quoted in yen, not dollars.
The Abra resource is around 35 million tonnes at 7.5% Pb and 18g/t silver, Mallee Bull/T1 in comparison is 6.8 million tonnes at roughly the same equivalent Pb grade. Interestingly, Galena have only been able to convert 10.5 million to mineable reserve because the drilling isn't close enough spaced at depth (i.e. it's in the inferred resource category).
The $90 million that Toho are spending is for 40% equity, valuing the Abra project at $225 million. I think Toho are assuming (as would be Galena) that a large percentage of the resource currently outside the reserve will eventually be converted to reserve and mined. It goes to show that until such time as more tonnes can be added at Mallee Bull, Toho/CBH may not be all that interested. In the PFS for T1, it should have only have been considered as a low capital (appoint a contractor who already has the mining fleet) dig and truck open pit operation to take advantage of the
high grade (Pex still haven't published the T1 resource by itself but its lumped in with the MB overall resource). That is the point of difference with a deposit like Abra -
GRADE! If you have a equivalent Pb grade of 20 percent (as T1 is rumoured to be 15 percent Zn) its conceivable that it could be trucked 140 km to CBH's Endeavour mine and process plant. Ore from Mallee Bull, being of lower grade overall compared to T1, probably cannot be profitably trucked 140 km, especially when it is being mined by underground methods from increased depth (more costly).
It appears as though Wagga Tank and Southern Nights will surpass T1/MB in terms of value. Whether it's tier 1 remains to be seen but it's heading in the right direction and we should know in the next 5 months leading up to the maiden JORC. It appears increasingly likely, that whoever builds a mine and plant at Wagga Tank/Southern Nights, will want to mine and process ore from 30km up the road at Mallee Bull/T1. The move by Toho Zinc to invest in the Abra Project is very interesting indeed. On the one hand it confirms that they're serious about securing base metal concentrate from Australia well into the future outside of their existing operations (which are struggling to some degree). On the other hand, given their market cap of only $600 million, perhaps they haven't deep enough pockets to take on the combined development of Wagga Tank, Southern Nights and Mallee Bull. Who's the next suitor? Why wouldn't St Barbara diversify from being just a gold play into a diversified miner? If I were CBH, I'd want to get a hurry on and rip out the high grade at T1 before St Barbera complete their takeover of Peel.
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