EQR eq resources limited

There's no debating the fact that the revised BFS' IRR of 397%...

  1. 1,395 Posts.
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    There's no debating the fact that the revised BFS' IRR of 397% was "out of this world" - most IRR's I have seen lately have been in the 20's.
    But with an extremely low capex of just $21.4M, a 29% increased NPV to $210M and the expectation of payback in mid 2023 (yes 2023!).
    Many factors have come together to put a genuine shine on this project, not the least of which was the strip ratio reduction from 11 to 3 and the recently announced drill program starting, I believe, as we speak.

    Kevin MacNeill, CEO, in his AGM address said they were currently producing around 70 tonnes of concentrate per month, and on track for 90 very soon (maybe by year end).
    He also said the drill program would probably add another 50 to 100M to the NPV. - and that still only represents c. 20% of the overall resource

    Those avid followers of the tungsten space out there should be well aware that virtually all other tungsten mines around the world are currently experiencing significant hurdles;
    G6M - another CR, generally high costs, remote location and a nearly $100M capex
    Almonty - Sandong having problems and experiencing delays - not much product coming out of their Spain/Portugal projects
    Tungsten West UK - ex Hemerdon mine - community resistance such that chasing aggregate quarry credits have been abandoned - higher net costs
    .....and thats just a few

    So what share price should we expect from this "incredibly well credentialled project" ?

    I understand that Morgans have been following the company very intently and now the revised BFS is out there, we can expect some research from them and hopefully a price valuation to boot.

    In the meantime, I will get the ball rolling on a very high and simple level ....

    Assuming about 1.5BN issued capital (not sure exact number after recent CR) and assuming we should be priced around 70% of the $210M NPV (given the stage we are at), then that would give us a figure very close to 10 cents. (and this still does not factor in the remaining 80% of the known resource)

    Thoughts anyone ???

    Merry Xmas TAH



 
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