Gold and Silver Juniors, Mid-tiers and Producers Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: E. Charters who wrote (55628)	1/21/2008 1:27:50 PM
From: Mr. Aloha	Read Replies (1) of 78428

There's no way the zinc plant will cost $450 million -- the $400 million estimate is for everything, including the mining, concentrating, and refinery/zinc plant, and has already been increased from $200-250 million to adjust for rising costs. Given GTI's Skorpion precedent at much lower zinc prices, they should have no problem getting bank financing and avoiding that heavy dilution. Baja mining recently raised over $500 million debt financing with a much riskier project that has had many failures on the challenging metallurgy over many decades. Zinc has dropped a lot from its high, but it's still much higher than when GTI put Skorpion into production and when MMG started work on this project, and also when Skorpion's feasibility study was done and it was bought out much higher than MMG's current value. We don't know the feasibility numbers yet, but even at much lower zinc prices they will be very strong for financing and very low risk because of all the infrastructure and since GTI just did it a few years ago at Skorpion. It's not a greenfield project done by a team that's never done anything like this. What debt investors look for in a project is low risk and return of their money even if metals drop significantly, and MMG has one of the few such projects around. With the Chinese and other zinc producers having a zinc cost of around $1.00/lb (http://siliconinvestor.com/readmsg.aspx?msgid=24232673 ), zinc can't go a lot lower without a lot of production shutting down. With their huge cost advantage, MMG should make huge profits from their zinc where others lose money and go out of business. They don't need a bull market to succeed -- Skorpion was bought out at the trough of the metals bear market. The mine plan/feasibility study numbers and silver exploration will tell us a lot more about the future for MMG. I think they'll prove the doubters wrong.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next