No confusion on my end. The cashflows in their NPV analysis are not after funding costs (as far as I can tell).
That means the WACC used in this analysis assumes both equity and debt funding costs. On no planet is that getting done at 6.5%.
If they think investors will accept a 6.5% nominal return for stumping up equity they have truly lost the plot. Therefore deriving an NPV under the assumption equity will be happy to get a 6.5% nominal return + residual return (NPV) is fanciful, especially considering that NPV isn't weighted for the project risk (50% in my view).
There isn't a lot left over. Can see why Majors may have walked from the bidding.
Ann: Gonneville Nickel-Copper-PGE Project Scoping Study, page-143
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