6.5 was the base case. It has to be conservative. looking at the model below, you can see the price of gold used for the base case was 1445/oz. May I suggest we review the spot price and real options columns for a more realistic and balanced discussion on the payback. I am sure that Teck will:) Cheers, SF
| Summary of Economic Results |
| Item |
Unit |
Base Case |
3-Y Avg* Case |
Spot Price** Case |
Real Options Case |
| Metal Price |
|
|
|
|
|
| Copper |
US$/lb |
3.25 |
3.63 |
3.69 |
3.25 |
| Gold |
US$/oz |
1,445.00 |
1,445.00 |
1,736.00 |
1,445.00 |
| Silver |
US$/oz |
27.74 |
27.74 |
32.71 |
27.74 |
| Molybdenum |
US$/lb |
14.64 |
14.64 |
11.34 |
14.64 |
| Exchange Rate |
US:Cdn |
0.97 |
0.99 |
1.02 |
0.97 |
| Pre-tax Economic Results |
|
|
|
|
| Operating Cash Flow |
CDN$ M |
10,746 |
12,065 |
12,161 |
11,284 |
| NPV (at 5%) |
CDN$ M |
1,694 |
2,348 |
2,419 |
2,665 |
| NPV (at 8%) |
CDN$ M |
513 |
967 |
1,024 |
1,382 |
| NPV (at 10%) |
CDN$ M |
25 |
388 |
437 |
836 |
| IRR |
% |
10.13 |
11.9 |
12.14 |
15.4 |
| Payback |
Years |
6.48 |
5.81 |
5.7 |
4.9 |
| Cash Cost/lb Cu |
CDN$/lb |
1.15 |
1.19 |
1.12 |
1.15 |
| Total Cost/lb Cu |
CDN$/lb |
2.09 |
2.14 |
2.07 |
2.09 |
| Avg Annual operating Cash Flow*** |
Millions |
371 |
414 |
425 |
640 |
