Northern Graphite Co (NGPHF)

[riverrock]

From the BFS

“Over the first five years, cash mine operating costs will average CDN$851 per tonne of concentrate. Over the life of the project operating costs are estimated at $968 per tonne of concentrate. These estimates are based on operating costs per tonne of ore of $9.60 for processing, $2.94 for general and administrative costs and $5.79 for mining.”



The above is saying, that OPEX will be $851 tonne of concentrate during the first five years of operation producing 18,600 tonne in concentrate annually. If you add a $102.9 million dollar 10 year loan at 7.5% paid annually, it could come to about $15.1 million annually.



OPEX + CAPEX cost should be ($851 x 18,600t ) + 15,100,000 = $30.93 million annually



Assuming Graphite sales averaged $2,600/tonne

Sales could give $2,600 x 18600 = $48.36 million annually.



Potential before tax profit could be 48.36 – 30.93 = $17.45 million.



Assuming they get a 7.5% 10 year loan without having to add more than 15 million new shares, to the present 46.46 million shares, they could have before tax earnings of 17.45/(46.46 +15.00) = 28 cents a share,



Not bad when one considers that their average sale price per tonne Graphite could be higher and they add production over the years.