The last 12 months have delivered some impressive results for...

The last 12 months have delivered some impressive results for New World Resources (ASX:NWC) at its 100% owned Antler Copper project situated in Arizona (USA) (figure 7) which has been dormant since 1975. Interestingly inflation that year in the UK peaked at 24.2% and the price of petrol leapt by 70%.The company recently updated its JORC Mineral Resource Estimate (1% Cu equiv cut-off grade) to 11.4Mt @ 2.1% Cu, 5.0% Zn, 0.9% Pb, 32.9g/t Ag and 0.36g/t Au.(4.1% Cu-equivalent*) representing a 48% increase in tonnes and 44% increase in contained metal since the 2021 maiden JORC Resource (figure 8).

While not a big fan of Scoping Studies, I do like the US$525m Net Present Value using a 7% discount rate with an impressive 42% internal rate of return (figure 9 – 2021 Scoping Study). I would think the significant increase in the 2022 JORC Resource has a good chance of improving these financial metrics at the Pre-Feasibility and Feasibility Stages. The Scoping Study contemplated a relatively simple flowsheet producing copper-gold, lead-zinc and silver concentrates at an operating cost (C1) US$1.66/lb copper equivalent.

I like the exploration upside (figure 10) which should feed into further resource upgrades and a better set of financial metrics as the project rolls into the more advanced study phases. The PFS is scheduled for completion in Q4 2023. I thoroughly recommend going to their website and reviewing the 2022 AGM presentation which I think has been very well put together.

Bottom line for this stock is I think +US$600m NPVs aren’t far away which should translate to, say, 20% discount to NPV (US$600m) at PFS = US$120m enterprise value (A$176m) or around +9 cents per share assuming no further share issues.I think this is a little conservative and +10-15 cents is a better than even bet from here by mid to late next year. For those * faithful who believe we should see an uptick in commodities next year, this stock should provide excellent leverage.