About Us

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Rhodite Consulting capitalizes on geneerations of contacts in the natural resource sector. Our valuation methodolgies go far beyond industry standards regarding valuation. At Rhodite, we understand that risk is never linear as represented by traditional Discounted Cash Flow (DCF) or Net Present Value (NPV) valuation methodologies; the first know application of a single discount rate, and thus the treatment of risk as linear, was in 1849 to value forestry products. Before computers, before calculators, and before access to large data sets and the vast access to information.  In fact, the application of a single discount rate is only really applicable to products that can be produced in perputuity (like forestry products). It also eliminates the proper inclusion of production optionality: we identify assets where optionality is not properly acounted for. 

The DCF approach utilizes 'static' models where the relationships between prices, costs, production, and economics are based on weighted averages (which are typically arbitrarily chosen). In actuality, models need to be dynamic and account for the correlations between hundreds of variables. As such, we do not ascribe a discount rate to a project, we derive it through various applications of 'Real Options Valuation.'

For Operators we can identify strategic insights on scenarios that require additional investment or downside protection, with statistical insight into which is more likely. For Investors, we identify private assets or equitiies whose upside or downside potential is mis-identified. For operators, we provide managerial insight into price & cost sensitivities, when to hedge or invest more, and provide a roadmap of how to optimally navigate millions of different situations. 

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