Re: Las Bambas Project
in response to
by
posted on
Nov 04, 2013 11:37AM
CUU own 25% Schaft Creek: proven/probable min. reserves/940.8m tonnes = 0.27% copper, 0.19 g/t gold, 0.018% moly and 1.72 g/t silver containing: 5.6b lbs copper, 5.8m ounces gold, 363.5m lbs moly and 51.7m ounces silver; (Recoverable CuEq 0.46%)
"To make the Las Bambas project comparable to Schaft Creek, you have to look at the buyout as a $2.7B buyout. If I sell a $50K car with $200K in cash in the front seat, this does not mean the car is worth $250K. Similarly, if I sell a $2.7B mine with $3.3B in sunk costs, it does not mean I am getting a $6B mine. You need to account for the sunk capex when you compare the buyout value to Schaft Creek"
Yes, I get all that. There was a misunderstanding. I thought you meant Las Bambas was worth 6 billion without the sunk costs. Sorry. So you are basically saying the Las Bambas is worth only 2.7Billion. The only reason Glencore is asking for 6 billion is they already put in half the capital cost to build the mine. From a value standpoint, SC could soon become bigger than Bambas and those operating costs that you mentioned could come down big time so I would not say those are correct numbers.