As per the June PLS quarterly, their CIF cost for FY 2024 was U$537 per dmt (down 27% from 2023). In the June quarter, it was down to U$483.
PLS have also given FY 2025 guidance, indicating that costs will be back up to approximately where it was in the March quarter (FOB U$444; CIF U$519), due to the integration of both the P680 at the beginning of the year and the integration of P1000 at the end of the year, as well as the temporary use of mobile crushing and sorting equipment during the integration periods. Their guidance statement notes that in FY 2026, with both major projects integrated and economies of scale, they expect costs to be even lower than the recent June quarter, though they do not quantify that statement.
By comparison, according to the LTR DFS, if it we take it at face value, and remember that it was produced November 2021, or just at the beginning of an unforeseen spot of nasty inflation, AISC will be U$452 per dmt. Of course, that’s a ten year average cost; the ramping costs will be significantly higher, but since LTR has not attempted to give any guidance of ramping production costs, any attempt to estimate FY 2025 costs for LTR would border on pure speculation.
To be honest, I’m not sure that LTR will be a significantly lower cost producer than PLS, at least until they get the expansion to 4 mtpa completed. Yes, LTR will be working with a better base material, actual process costs will probably be a bit lower, and LTR should be able to produce a better product, but PLS will have better economies of scale for the foreseeable future.
By way of disclosure, I own both (a little more PLS than LTR, but the numbers are comparable), and expect to profit handsomely from both, whether it's a T/O, in the nearterm, or dividends and capital appreciation in the long term.
Best regards,
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