Something Fishy Here!, page-102

If the weather events have resulted in significant disruption to mine production at Ravenswood then the company should really announce as much and give the market some revised guidance based on the impacts of the weather events. Clearly they haven't, as yet, so it should be safe to assume any impact will be limited and not a threat to current guidance.

Let me add that managment are being proactive in this ramp up stage at Syama having forward sold 30,000 ounces of gold at an average price of US$1,335 per ounce in scheduled monthly deliveries of 5,000 ounces between July 2019 and December 2019. That's ~A$1,885/oz.

If the Syama mine was in trouble they would have forward sold a larger amount of gold and sold it over a longer period IMO. We know that the oxide operations at Syama for the Dec quarter produced 34,653 ozs at an AISC A$742/oz which if repeated over the next two quarters would mean margins on the mine at Tabakoroni (based on the locked in hedging) of A$1,143/oz. On 30kozs of gold that is about $34 million of free cash flow per quarter from the Tabakoroni pit alone if they can sustain similar amounts of oxide ore with similar recoveries and the gold price holds these low 1300 levels.

Surely people can see some potential here if the ramp up goes smoothly and they can start reducing AISC from the sulphide circuit from the distoredly high Dec quarter figure of A$1,829/oz. Remember the targeted AISC from the sulphide operations once all staged development projects are completed at Syama is US$746/oz or about a margin of US$564/oz or A$770/oz. On 2.4Mt of production (assuming current reserve grades and 85% recovery) that's free cash flow from the Syama sulphide circuit alone of about A$136 million per year. You see once this thing hums the debt will look like nothing. The net debt is already practically nothing at $56 million (OK probably more like A$ 94 million if you don't count those pesky less liquid listed investments). Still nothing by comparison to the US$205 million (A$289 million) in net debt that AQG is carrying. Good luck with that noose if Copler hits some issues. Copler is looking like a success so far but they still haven't hit commercial production despite the upbeat reports. If Syama had have got into debt to the tune of A$289 million to develop and stockpile ore from Syama UG on the ROM pad like AQG has done at its open pit a Copler do you think investors would be cheering the company along from the sidelines? I doubt it. The Canadians are their own special breed if they think going into debt to stockpile ore makes sense. Copler if sucessful will pay its debt off in 2.7 years (at a US$1,300 gold) and 2.5 years (at US$1,350 gold) assuming the exchange rate, electricity cost, diesel cost and silver price assumptions hold from the DFS. The DFS for Copler has a best case NPV for total sulphides (nested pits) at US$1.300 gold of a little over US$1 billion (CAD$1.3 billion) and a worst case NPV at the same gold price of about US$820 million (CAD$1,090 million). AQG currently has a market cap of CAD$984 million and an EV of CAD$1,257 million so is trading around the LOM NPV for the project. A bit rich considering it is still in the commissioning stage and still carrying A$289 million debt. Well that's markets for you, mostly very happy to get well ahead of themselves. Not as bad as NST though which has got so far ahead of itself it about to lap itself. Esh