With the new combined feasibility study out its possible to do a comparison with others seeking to make the same products. I think the reason for the increase in price and volume since the release of the feasibility study is likely due to favourable comparisons. I've converted everything to USD to allow for easier and more accurate comparisons. (You'll have to scroll across to see the whole table)
4N HPA Producers Nickel and Cobalt Sulphate Producers Altech Chemicals (ATC) Alpha HPA Ltd (A4N) FYI Resources (FYI) Pure Minerals (PM1) Australian Mines Ltd (AUZ) Clean TeQ Holdings Ltd (CLQ) Market Capitilization 40m 98m 11.5m 9m 33m 150m Market Capitalization Post-tax NPV (USD) 505m (7.5%) N/A 543m (10%) 1000m (8%) 575m (8%) 1392m (8%) Post-Tax NPV (USD) CAPEX (USD) 298m 209m 189m 442m 974m 1495m CAPEX (USD) IRR (post tax) 22% N/A 46% 31% 15% 19.10% IRR (post tax) EBITDA (USD) 76m - 133m 177m 231m 344m EBITDA (USD) HPA Operating Cost (USD/t) 8550 5940 (after by products) 6217 3074 (without by products) HPA Pricing Assumption (USD/t) 26900 25000 24000 25000 - - - HPA Production 4500tpa 10000tpa 8000tpa 4000tpa - - Other Products none 2 Fertilizer Products none Haematite, Magnesia Scandium Scandium, Ammonia Sulphate Other Products 0.565mtpa 2mtpa 2.5mtpa Throughput 1.60% 0.58% 0.75% Ni Grade 0.18% 0.08% 0.15% Co Grade 7 (2) 7 (2) 7 (1) Ni Price Used (USD/lb) 25 (0) 30 (0) 30 (0) Co Price Used (USD/lb) Payback Period 3.9 years 2 years 3.6 years 3.5 years 5.8 years 4.3 years Payback Period
Revenue Diversification
Commodity price cycles can be make or break for producers, I think the diversification of revenue is very appealing. Personally I think pure HPA producers underwrite a decent amount of commodity price risk. Cobalt as we all know is significantly less than $30/lb. I note the spot case financial analysis in the PFS which used a $5.70 nickel price, $14.15 cobalt price, $20 000 HPA price still had an AUD NPV > $1bn post-tax.
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