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Gold/Mining/Energy : Zentek Ltd. -- Ignore unavailable to you. Want to Upgrade?

To: LTGoldBull2 who wrote (2629)	6/10/2015 11:07:07 AM
From: LTGoldBull2	5 Recommendations Recommended By Bills16 formerTN George69 NLWest panamax Read Replies (1) \| Respond to of 54353

I think we will have a pleasant surprise on or around 15th July, for full PEA disclosure and Technical Report. The answer provided to my difference in NPV calc's, not verbatim, is the 1 June NR, presented summary results and conclusions, and that further detail can be expected in the coming full PEA, which in my words is taken to mean besides more detail, more concise and accurate too. $115M usd's difference in NPV is big in determining current share price valuation of a prospective take-out, and shake my head at the RPA conservativeness when looking at the numbers. (ex., us$438M compared to us$553M) Capex at us$411.5M, as contingencies taken now at us$80M will be at or near $0 by mining. (result of -$80M is an NPV at us$633.4M, using us$110M net cash flows over 22 years) Discount Rate 10% is high, (Current NPV us$553M at 10%, is us$913M at 6%, which is more in-line current economic conditions and will go to zero year 1 of mining = NPV us$2.0 Billion) Other uplifting NPV Factors, Prices Paid/Tonne, RE's us$8500 - PEA us$7500, imo a surprise lurking for the 4th sector and that prices are not set for LiB, Fuel Cell and Powder Met. I believe by year 1 mining Chahar and Yamashito will have contracted higher than avg us$8500/t providing a big boost to NPV and IRR. Mining & Processing and Recovery Rates should be better before year 1, based upon the new (2) smaller conceptual Open Pit, which will reduce Mining Waste significantly (Overburden same as) compared to the RE's, one large Open Pit encompassing the whole resource. Processing Optimization will continue until year 1 mining with more improvement than currently indicated. RPA set a very conservative base, to enable ZEN to only work higher in Valuation. The problem, the TSXV no longer values companies, only trades them until forced to do so by Formal Offers. Cheers, Mark (still my opinion AE and Stowe will get a Best Valued Deal, though like that Tesla Strategic Partner scenario)

To: LTGoldBull2 who wrote (2629)

7/7/2015 8:56:19 AM

From: LTGoldBull2

2 Recommendations

Recommended By
cbs12311
George69

Read Replies (1) | Respond to of 54353

ZEN stated after-Tax NPV $438M discounted at 10% in the PEA, using variables Capex us$411.65M, Net Cash Flows us$110M, on less than ½ the Resource for an Open-Pit lom for 22 years.

NPV for Dummies (me), countered, using same variables, NPV was actually us$553.4M at 10% (In my calc’s, year 1 mining was discounted as year 1, ie., full value $110M, where ZEN discounts by calendar with year 1 mining as actually year 3 then +22 year minelife.) see table below,

Note 1: Year 1 in 2018 not scheduled for full year mining.

Note 2: In 2018 after Mine Build NPV will be us$553.4M discounted at 10%.

Note 3: In 2018 after Mine Build, no Discount is required, NPV is us$2.0 Billion (Cdn $2.54B), OK too much for some, let’s say even after minebuild there is still risk and use 3.0% for equivalent 10yr Bond Rate, NPV is still us$1.34B (Cdn $1.78B at today’s 78.65 exchange cad/usd)

Cheers, Mark

Date	Year	Net Margin	NPV	Discounted
		Cash Flows	10%	Cash Flows
			Open Pit
2016	Build		-411,465,000	10%
2017	Build	0	-411,465,000
2018	1	77,021,420	-347,810,930	63,654,070
2019	2	110,000,000	-265,166,300	82,644,630
2020	3	110,000,000	-190,034,830	75,131,470
2021	4	110,000,000	-121,733,480	68,301,350
2022	5	110,000,000	-59,641,340	62,092,140
2023	6	110,000,000	-3,193,955	56,447,385
2024	7	110,000,000	48,121,857	51,315,812
2025	8	110,000,000	94,772,595	46,650,738
2026	9	110,000,000	137,182,350	42,409,755
2027	10	110,000,000	175,736,680	38,554,330
2028	11	110,000,000	210,786,070	35,049,390
2030	12	110,000,000	242,649,150	31,863,080
2031	13	110,000,000	271,615,590	28,966,440
2032	14	110,000,000	297,948,720	26,333,130
2033	15	110,000,000	321,887,920	23,939,200
2034	16	110,000,000	343,650,830	21,762,910
2035	17	110,000,000	363,435,300	19,784,470
2036	18	110,000,000	381,421,180	17,985,880
2037	19	110,000,000	397,771,980	16,350,800
2038	20	110,000,000	412,636,340	14,864,360
2039	21	110,000,000	426,149,400	13,513,060
2040	22	110,000,000	438,434,000	12,284,600
2041	to		Underground
2062