Nose, may I speak on behalf of all readers and contributors and say how great it is to have your back. Your informed and insightful posts are so refreshing!
It seems however you might have misinterpreted my post. I refer to FWL needing to raise $500m, which happens to be 50% of $1bn (I agree with your assertion that costs would have increased beyond earlier $600m estimate - great minds think alike!).
As I'm sure you're aware, being a 50:50 JV, FWL will only need to fund 50% of construction costs. The Chinese will fund the rest.
I agree that FWL will be stretched debt funding $500m. As I've said previously in this forum, my preference would be for a JV arrangement simliar to that entered into by Bauxite Resources recently (BAU fund just 10% of construction cost and receive 30% of production).
If they can't debt fund $500m, they'll need to raise some equity. If you'd done your sums Nose, you'd understand that the projected NPV of the project is still attractive even with a bit of dilution.
But perhaps, Nose, I need to take your lead and be more reliant on Fairy Godmothers than facts!
LCG Price at posting:
16.2¢ Sentiment: Buy Disclosure: Held
