Sweet Sweet Itappy's Badasss Orebody, page-47

That's a loaded question with the information we have but I will try and answer it.. just be aware that I am assuming things also.

In terms of a laterite deposit, you would normally want a larger deposit than 43.5mt because laterite deposits are harder to process. They usually require high temperature/pressure acid leaches (HPAL) which are capital and operating intensive, and thus economies of scale become more and more important. The major benefit to deposits like this is that they are very simple and easy to mine, with relatively thick intercepts (hard to miss 11m even in a big truck) and shallow (very little overburden) so the mining costs become very low.

Now if you looked at 43.5mt, most people would look at a 10-12 year mine life, to try and maximise the return (by minimising the overall NPV discount effect) which means ~4mt per year.

From this presentation (march 2018 - https://www.gigametals.com/site/assets/files/4861/2018-03-19-hpal.pdf) they list the capital intensity of HPAL, cobalt nickel plant, feeding 4.3mt per year (page 11) as costing 2billion dollars.

That figure is astounding when you first read it and I am sure it is likely on the high end (as a smaller plant above this had a lower capital intensity, which means this project was inefficient) but lets say it had the same capital intensity as the one above, that would still be ~1.6billion for this plant.

Now to recoup investment you look at the grade of the nickel and cobalt and thus the metal you will sell at the end.

This deposit looks to have an average currently of 1% Ni and 0.1% Cobalt (weighted against interval) and thus this plant would product ~43000 tonnes per annum of nickel and 4300 tonnes per annum of cobalt. The one good thing with HPAL is you get very high recoveries, usually approaching 100%, however for this we will discount by 3%, so 41710tpa of nickel and 4171 tpa of cobalt.

Nickel is currently $15,500 US per tonne (http://www.infomine.com/investment/metal-prices/nickel/, multiply by 2,200 to go from usd/lb to usd/t), while cobalt sits at just above $80,000 us per tonne (https://www.quandl.com/data/LME/PR_CO-Cobalt-Prices) However historically has been much lower so I'll use $60,000 going forward to match the likely pricing rate over the life of mine assuming an optimistic cobalt price (historical average is $30k, but electric vehicles etc).

That means per year, you're revenue would be $917 million USD per year.

The average cash cost per tonne of nickel produced (Cobalt is seen as 'gravy') is ~$5.50 cents per pound over the last 5 years (from that presentation of world wide operations) which is a cost of ~505 million USD per year for the mining/processing and probably another 50-100 million worth of overheads, taxes, royalties etc so lets say 550-600million per year, leaving a profit of 300-350 million per year.

That's an IRR of ~24% which is not bad (gross return of 87.5%) and most projects would pursue that into a feasibility study or further with that return.

One cautionary note is simply that most of these HPAL plants take 5-6 years before reaching max throughput and most sit ~80% average over the time, which has a huge impact to cashflows (drops to 19% IRR which is borderline and this is very high level so not convincing).

TLDR: yes this size deposit is significant but it is marginal depending on how the plant is sized, what capital can be raised at (interest wise), how much nickel and cobalt are worth and how efficiently the operation can get up and running.