Kalkaroo Copper Project Peer Comparison

Kalkaroo Copper Project Peer Comparison

I have been focussing on separating Havilah from the mining junior pack by articulating why Havilah has the best risk-reward equation.

For the first peer comparison, I have used Havilah's flagship Kalkaroo project (in South Australia) alongside Sandfire Resources Limited's next flagship T3 Motheo project (in Botswana).

A comparison of Havilah's 18 June 2019 Kalkaroo copper-gold project PFS (revised for the 2 December 2020 ASX Media Release new LT metal prices) with Sandfire Resources Limited's T3 Motheo copper-silver project DFS/FID (ASX announcement on 1 December 2020).

The NPV for Kalkaroo is exactly two times the T3 Motheo project. It should be pointed out that Sandfire used a more favourable discount rate and FX rate. It is also highly likely that Sandfire will only end up with 85% of the T3 Motheo project once the Botswana government backs into the project.

	Column 1	Column 2	Column 3
0		Kalkaroo Copper-Gold Project (South Australia)​	T3 Motheo Copper-Silver Project (Botswana)​
1	Company​	Havilah Resources Limited​	Sandfire Resources Limited​
2	Ownership of project​	100%​	100% (subject to 15% back in by Botswana government)​
3	Status​	PFS published 18 June 2019; Mining Leases granted; ownership of land on which project is located is via Kalkaroo pastoral lease; PEPR not yet granted​	DFS published 1 December 2020; FID approval; Environmental Impact Assessment approved; land not yet acquired for the project and infrastructure; Mining Licence not yet granted​
4	Pre-tax NPV A$​	A$903 million​	A$451 million​
5	IRR​	26% (based on original PFS long-term copper price of US$2.89/lb and gold price US$1,200/oz)​	25%​
6	Discount rate​	7.5% (2019 real)​	7% (2020 real)​
7	A$/US$ exchange rate​	0.75​	0.70​
8	Copper price (long-term)​	US$3.10/lb​	US$3.16/lb​
9	Gold price (long-term)​	US$1,500/oz​	-​
10	Silver price (long-term)​	-​	US$17.92/oz​
11	JORC Ore Reserve​	474,000 copper tonnes; 1.4 million gold ounces. 90% in 'Proved'; 10% in 'Probable' classification​	360,000 copper tonnes; 15.6 million silver ounces. All in 'Probable' category​
12	Copper cut-off grade​	Saprolite gold resources 0.2 g/t gold cut-off grade, while for the main Kalkaroo copper-gold resource a 0.4% CuEq cut-off grade​	0.44% copper cut-off grade ​
13	Average production (as recovered metal) anticipated​	Approximately 30,000 tonnes copper and 72,000 ounces gold p.a.​	Approximately 26,500 tonnes copper and 1.1 million ounces silver p.a.​
14	Life of mine (processing)​	Minimum 13 years​	Initial 12.5 years​
15	Waste: Ore ratio (including pre-strip)​	3.5:1​	6.0:1​
16	Mine distance to nearest port​	~350 km (road and /or rail) to Port Pirie, South Australia​	~1,000 km by road to Walvis Bay, Namibia​

Sources for above table:
Kalkaroo https://www.asx.com.au/asxpdf/20190618/pdf/445xm614yw5s9f.pdf
T3 Motheo https://cdn-api.markitdigital.com/a...access_token=83ff96335c2d45a094df02a206a39ff4


Cheers

These are only my thoughts and it does not constitute investment advice. Before acting on any information you read and before making any financial or investment decisions, you should always consult your advisor(s) or other relevant professional experts.