I think its a genuine flip flop, not something sinister from...

I think its a genuine flip flop, not something sinister from Citi.

When you read the HIO announcements over the past year, they are happy to keep the marketed updated with progress updates on partially complete work. For better or worse this starts to paint the picture of how this has probably happened.

Somewhere prior to the Feb 2022 announcement to broaden the BFS scope to 20Mtpa, there's been some sort of conceptual assessment done that warranted the idea to look into it further, and the advisory committee engaged in Jan 2022 have seemingly accepted the business case and allowed it to advance so far to the point that the board wanted to target that case by June 2022.

Was there enough time for a detailed enough assessment on those big ticket items to hone in on the 20Mtpa between Feb and June? That's only 4 months. At best you're moving a concept study (+/-50%) into a early PFS/scoping (+/-30%). Allowing enough time for an independent review and board meeting, geez. That is simply not enough time to get the level of engineering needed for a BFS level of confidence to rule out the other production cases (+/-15%). Furthermore, the market for mining consultants was extremely tight in the first half of the year.

My hunch is someone has come out a little while ago with a factorised cost of either the pipeline or the port facility that led the board to believe they should pursue the 20Mtpa. This is very common in mining when its easy to sell the "bigger is better" story in a bull market. Let's not forget the board won't necessarily have the expertise to scrutine those numbers, most of the time they are here to rubberstamp recommendations. In the 4 month period from Feb to June there's been a rush on an estimate to test the waters on that 20Mtpa, possibly gotten it to a PFS assessment level. The project director has possibly come in late (post board approval to BFS the 20Mtpa) and said it just doesn't stack up in today's dollars (each of the pipeline or port infrastructure alone could be in the order of $100M+ at the right size) and its been reigned in as unfeasible by the exec's (via the board).

Messy, but probably not too far from the reality.

Someone's going to get the chop here. Has the company really messed up the PR with shareholders? Absolutely. But like I said my hunch is its from somewhere in the project team there's been a rush on some sort of estimate and in today's market the combination of inflation and a pretty quick push from re-scoping to include 20Mtpa to entirely focussing on that case alone in 4 months, has probably led to a monumental error somewhere in the piece.