In the drilling update, Oct production is run-rate of ~45kozpa. First year is 50koz+ so tracking well in the final stages of ramp.

Update the val given gold price has marched a lot higher. Val now at A$5500/oz vs $4500/oz which gives NPV/sh of $0.272 vs $0.200 despite the dilution that has occurred since. This is +21% upside at the current SP of $0.22.

~11-12wks into commissioning and ramp and MEK has been oddly quiet although I would hazard and say that if anything was not going right in a significant way, it'd have leaked out. But instead the SP is hitting new highs and melting up with the gold sector.

Given the close of the valuation gap (i.e. SP to NAV has shrunk) despite the rise in the gold price, this is getting to fully valued territory imo. With the gap closing, MEK needs a nee fundamental driver (maybe good recs in the OP feed that drives higher production) otherwise the SP will be driven more as a proxy of gold price movements and relatively operating leverage (i.e. incremental margin expansion). As such, this is getting close to an area to consider booking profits and rotating into other gold names with value.

But what would I know as with the power of hindsight, I have been a bad seller of MEK.

I have been doing a little thinking and I think MEK may run be running a little closer to the sun than I am comfortable with. That and some scuttlebutt, leads me to believe that there is an elevated risk that MEK may have to raise. Quantum could be $10-20m which is easily doable in this market.

I have de-risked my position further and will look at any raise as a catalyst to re-buy. That said, I have been finding good opportunities amongst the gold developers cohort (AAR & MI6) and selective explorers (BNZ).

Updating the val to show $5000/oz gold price and listing the upper end of the scenario analysis. Good follow u to show the dynamism in valuation for resources stocks in pricing environments like this. The payoff profile is much lower than before when using A$3500 and A$5500 but recalibrating the lower end to ~A$4400/oz and A$6000/oz which are -15% and +16.3% to spot, the pay off profile remains at a healthy 5.6x.

Very belated post to update from my prior one on production profile and valuation.

Prior to the release of FS2 in Dec 24, I tried my hand creating a revised mine plan which turned out to be not too far off from what MEK went to publish. Whilst I had less additional ounces than what was published in FS2, I had a lower cost assumptions from modelling in scale which appears to not be considered (co being conservative?) or has been offset given the extra year (10 vs 8-9). In addition, the addition of a second UG mine added further cost not scoped in my revised mine plan.

Below is the mineplan summary for DFS+ (me estimates) and FS2 as reported by MEK

A production and valuation summary of the DFS, DFS+ and FS2 are detailed below.

Below is a sensitivity based on A$3000-5000/oz gold price ranges.

Outside of MEK managing to fuck up the mine restart (which I think is very low risk given management experience), there remains an attractive asymmetric bet at the current share price as the share price is still discounting a smooth restart to mining and/or the current gold price being sustained.

Belated update on y'day's release. Essentially production rate will be increased with 38koz in stockpiles processed upfront so net+ to NPV and an additional 113koz at ~A$1500/oz margin to be included over yrs2-7 from reserves not previously included. So a step change in the economics expected to come once mineplan reoptimisation is completed next qtr.