How do you get to $1.5b valuation for 10tpa production?
I mean hell I'd like that, but please substantiate a bit.
Argosy did more than a "rudimentary" assessment and valued the business at ~US$400 at 10tpa
PEA from NOV 2018.
https://www.argosyminerals.com.au/sites/default/files/presentation_file/agy-asx-20181130-pea-nov2018.pdf
The PEA assumes 100% ownership for simplicity.
Of course AGY will own 90% of Puna when funding for the 10ktpa plant has been provided as per JV agreement.
So $141M for 12.5% stake in Puna? Apparently the JV is worth US$1128M haha.
Their base case...
case v.
Used a discount rate of 10% and came to a pre tax NPV10 of US$399M for the 10ktpa @ US$13,000.
case vi
estimates the pre tax NPV10 of US$580M ( eye balling the graph there )
If I extrapolate those numbers for a US$17,600 lithium price then the NPV10 is US$730 ( I'm sure it's more complicated than that )
Still a far cry from $1.5b.
Some of the operating costs are 3% revenue royalties and 4.5% installed equipment "sustaining capital".
Items not taken into account in valuation:35,000 t/y of potash and 25,000 t/y of magnesium hydroxide.
- These models ignore any potential side income from the byproducts created in the production process.
I could not really find prices for these and the devil is in the details but it seems like US$200+ at least.
Not huge amounts but hey, it's another US$12M+ per year, it adds up.
- IP.... which could potentially be very valuable when applied but hard to put a real valuation on an intangeble like that.
- Expanded resource and increased life or mine at same or increased scale.
- TLP
So where does your evaluation differ from what Argosy did themselves?
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