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Gold/Mining/Energy : Metallica (MR T) -- Ignore unavailable to you. Want to Upgrade?

To: baystock who wrote (132)	3/9/1999 11:26:00 AM
From: Claude Cormier	Read Replies (1) \| Respond to of 263

<<Any idea what will be the net cash flow to SWG from this deposit ? I will keep an eye out on SWG to see if I can get a better handle on it.>> It is very early too tell...as we don't know if costs will be closer to $0.25 or $0.30 per pound. Production rate would be a mimimum 75,000 tons per year with possibility to reach 100,000 or more depending on the utimate reserves they define. Early metallurgical tests show recoveries above 90% and it it could get higher. The final output could either be zinc metal ((eliminating smelter charges) or concentrate. They are now at 1.8 billions pound in resource. I can see strong cash flows in future years, possibly as much as US$30-$40 millions per year to the JV partners per year, assuming zinc prices of only US$0.50-$0.55 per pound. Southwestern's share of these possible cash flows, based on a minimum 30% interest (could be as much as 49% if they decide to paytheir share of the costs to bring the deposit into production), would come at US$9-12 millions ($C13-$18 millions or C$0.90-$1.20 per share) But again it could be more depending on final parameters. From what I've study on their various JV's, Accha is only one out of many that could be of similar size or bigger.... All this, without the need to raise cash as they are carried to production all the time. <<As for NORPF's gold prospect...I don't know what the NPF deposit is. But the 1.5 million oz I was refering to is in their Tabar Islands project where they completed a feasibility study in which 1.5 million oz was used as the number. If you read through their press release you will see that this study was completed in '98. Also completed in '98 was the feasibility study on the Ramu Nickel project which is as large and as low cost as Voisey Bay nickel project, and where NORPF owns 22%. So including the Triton copper project also, Norpf does have 3 attractive projects where feasibility studies have been completed, and so are much further advanced than any thing SWG has at this stage. >> Well spent an hour on their website (which is way outdated) and can see what your mean. Impressive. Will go through their press release today. Look indeed extremely cheap. DO you know why ? Low metal prices cannot justify that low valuation. What about the lawsuit ? Waht about their balance sheet...? Honestly RAM, this one is really intriguing..and I've ask an info pack. Will call them for sure.