Argonaut visited Metro Mining’s (MMI) Bauxite Hills Project in Northern Queensland. The project is ramping up strongly after commencing mining in April 2018. MMI is producing comfortably at the 2Mtpa 2018 guidance rate and ratcheting up to the 3Mtpa 2019 guidance rate. The Company recently executed additional offtake contracts with 90% of 2018 production and 80% of 2019 production now committed to Chinese customers. While Bauxite Hills is still technically in ramp-up mode, we expect positive cash flow in the September Q. We model ~A$9/t EBITDA margins for H2 2018, increasing to A$20/t as the project achieves the target 6Mtpa rate by 2021.
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