To be more specific, I have converted my estimated NPV into share price,
--------------------------------------------- Main assumptions:
6% spodumene price: USD$800/t (currently contact price is about USD$1,000/t)
Tin price: USD$20,000.
Tantalum price: USD$66/t (same as PLS' assumption)
AUD/USD: 75c
Recovery rate: 80% for lithium
Discount rate: 10%
Capex (100% basis): USD$120m for 2mtpa; USD$280m for 4mtpa; USD$560m for 10mtpa (for 10mtpa, capex should be much lower, probably USD$400m).
Road upgrade: USD$285m funded by China as ASX announced
Hydroelectric power station: ~USD$45m to be funded by Dathomir as ASX announced
AVZ's 60% shared capex contribution: USD$72m for 2mtpa; USD$168m for 4mtpa; USD$336m for 10mtpa
AVZ's 60% shared after-tax NPV@10%:
A$1.1b (15 year life of mine) - A$1.5b (40 year life of mine) for 2mtpa. A$2.6b (15 year life of mine) - A$3.5b (40 year life of mine) for 5mtpa.
A$5.4b (15 year life of mine) - A$7.1b (40 year life of mine) for 10mtpa.
AVZ Price at posting:
26.0¢ Sentiment: Buy Disclosure: Held
