GP Capex for project in AUD is around $240m. WAF will use up a...

GP

Capex for project in AUD is around $240m. WAF will use up a fair cunk of its current cash balance by end of year and may only have around $25m left. That money will be needed to fund them over the subsequent 2 years for exploration and admin so they will need to raise at least another $240m for the project.

I very much doubt that lenders will provide a novice company $240m to build a mine in Africa without getting shareholders to stump up some serious money. I would expect another CR for up to $80m, but it could be even more.

It is possible that with some more increases in the high grade reserves the post tax NPV for the project will increase by 50% which will be reflected in a higher share price and hence less shareholder dilution when they come to do their CR.

Given the parameters outlined in the report, I expect the bankers to be making approaches to WAF to provide finance at OK terms.

But I could be wrong, and am happy to hear other people's views.

Overall, like some others have mentioned, this seems to me to be a lower risk project and I would be happy to make a 50-80% over around 2-3 years, but I hope its higher if either the USD POG lifts a lot and/or the high grade reserves increase substantially.

loki (I am just guessing - have been wrong many times.)