Silicon Investor (SI) -- The First Internet Community

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 : Precious and Base Metal Investing -- Ignore unavailable to you. Want to Upgrade?

To: Claude Cormier who wrote (15167)	7/31/2003 10:40:14 AM
From: The Vet	Read Replies (2) \| Respond to of 39344

Claude, for some reason Diavik no longer gives quarterly reports and the tone of all recent releases is to downplay the deposit even though it is doing far better than projections. (I smell a takeover attempt in the wind) Mine throughput will be 1.9 million tons a year (up from the original design of 1.5) Grade seems quite solid at 5.2 carats per ton and the first run of the mine batch sold at $96 a carat well above initial estimates. Multiply that out and you get 9.88 million carats (40% to Aber) makes their share 3.95 million carats at say $90 a carat give annual cash flow at $355 million for Aber less cost of mining which was originally set at $84 CAD a ton. Recent releases report that that figure has been bettered. That makes Aber's share of the mining cost at around $44 million (USD) per annum. That leaves an annual cash flow from operations for Aber at $311 million US with 53 million shares issued makes it $5.86 US a share. Of course Aber has financing costs, but they also can gain a premium for part of their output with their direct selling deal with Tiffany. These figures are "best case" and will not be achieved until we are mining the "real" ore of 154S in the second year of operation. For the first 6 months mining has been in low grade overburden but even that has been grading pretty well. None of this reflects last night's announcement on 154N pipe. However it seems to me that this is announcement is decieviong as it only tested the same "low grade overburden" of the 154N pipe. If it's structure is similar to 154S then the grade in the deeper ore will be better. Regardless that increased the mine life by at least 6 years. (The bulk sample from 154N alone yielded a cool million in diamonds)