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Every why hath a wherefore

An initial thought on the Tinka Resources (TK.v) PEA

As expected, Tinka Resources (TK.v) announced its PEA this morning. Here’s the link and while I’m going to be looking at it all day, an initial thought gets illustrated by this graphic from the NR:
They used U$1.20/lb for zinc in the economics, which was higher than the U$1.15/lb in previous resource estimates and slightly above the current spot price (U$1.17/lb). That’s not my idea of a “base case” so in order to get a handle on the robustness of Ayawilca PEA a little math is required. This visual helps the process, as it tells us that at U$1.08/lb Zn the NPV drops to around U$230m. 
We also note that TK’s share price has tanked this morning, down 26.5% to 23.5c (and was lower earlier). That puts TK’s market cap at U$47.3m. In other words, 13% of NPV at U$1.20/lb Zn and  20% of NPV at U$1.08/lb Zn. And now I’m going to think more about the meaning of this PEA.

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