Ann: TECH Project Feasibility Study, page-101

A quick summary of both sides of the coin, a few questions, and a final thought from me...

Advanced FS is certainly not a home run. Capex is high and while inflationary pressures are easing it is still a big task to complete. Debt finance will need to see the +/- range contract; -15% to +24% on the $1.9bn estimate is too wide at current to obtain firm commitments up to 60%. This said, with exceptional offtake certainty, relatively low sensitivity to nickel price and FX rates, and EBITDA profitability ~50% there is a lot for debt financiers to like.

I haven't gone through this line by line, but I can't see anywhere the assumptions used regarding financing structure. We know that QPM is targeting a 40:60 equity:debt split, but is this assumption actually valid in the FS? I assume for now it is not, as things like interest rates, drawdown timings, debt prepayments etc. are not close to baked and all have material impacts on free cash flow, NPV and IRR.

If right, that the FS economics are project economics, not equity economics, then I think there's a lot of upside here. Jamming 60% debt into the project even at current rates will enhance the equity's NPV and IRR metrics immensely. So while raising ~$800m equity from a $250m m/cap base might be difficult, QPM's m/cap today is a bit of a red herring.

What is more important is the NPV / IRR flow to equity based on final project assumptions (and the likelihood of those assumptions occurring). And with QPM's Green credentials, political security, supply chain and industry tailwinds, and limited competing demand for equity projects, equity should be forthcoming.