Hi BLSH.
Further detail on Messina breakdown of PGM's , derived from Merrill's April 20 report. It would appear that platinum represents 44% of the deposit , palladium 35% , rhodium/ruthenium/iridium/gold 20% , balance is nickel/copper . Accordingly , of the known 10.5 million oz. , 3.675 oz. are palladium (or say 2 million oz. to SUF - i.e. 54%).
As best as I can determine , SUF's diamond assets have been valued in the $6-8 per share range (see Merrill report , CIBC World Markets Sept. report , Hilton Ashton's most recent valuation) by the majority of analysts that have expertise in this sector. With the increase in planned production from Messina (60K tpm/120K oz. p.a. to 80K tpm/160K oz. p.a.) and the improving PGM market , a rough analysis would suggest a $5-6 NAV per share for SUF's 54% interest (as opposed to $3-4 NAV per share in April); of course , any equity financing to fund the acquisition might alter these #'s somewhat.
So , if palladium is worth say $1.75 - $2 (i.e. 35% of $5-6), suggesting that it represents 15% of SUF's total holdings is probably not too far off the mark. That said , SUF is currently trading at a huge discount to its diamond assets and whom knows if the market will apply a gold-like premium multiple on its PGM assets.
Regards. |
