Ann: Makuutu Rare Earths Exploration Target Increases by 50%, page-119

ASM projections:
The Project could potentially be successfully implemented as a single 1Mtpa plant (base case) or via two stages of development at 500,000 tonnes per annum (500ktpa) plant feed rate each (staged build).

The Project could generate A$4.7 billion free cash flow at the 20 year base case with a forecast capital cost of A$1.3 billion base case build or A$808 million for the stage 1 build.

Internal rate of return is estimated between 16.1 to 17.5 per cent, depending on whether capital is managed to build the Project in two stages or proceeds to a single 1mtpa plant, with both alternatives confirmed viable.

The takeaway here is that the 500ktpa start up although half the capacity will not be half on the opex as you still have to run the crusher circuit regardless plus the other machinery for processing.

A forecast capital cost (base case) of A$1,297M 4 with an additional A$124M of sustaining capital over 20YP, giving an estimated Net Present Value (NPV 8%, pre-tax) of A$1,236M and estimated 17.5% Internal Rate of Return (IRR, pre-tax).
Potential undiscounted free cash flow (staged build, pre-tax) in excess of A$3.9 billion3 , forecast capital cost (staged build) of A$808M for stage 15 , A$692M for stage 2 (with opportunities to stage further) and an additional A$39M of sustaining capital over 20YP, giving an estimated Net Present Value (NPV 8%, pre-tax) of A$909M and an estimated 16.1% Internal Rate of Return (IRR, pre-tax).


What makes this interesting for me is that ASM Market Cap went up to equal it's reduced stage CAPEX number of $808 million at 500ktpa output or double it's predicted revenue of $397m.
What does this mean for IXR? You do the math.