Interesting comment on the Scandium.  BFS assumes 10% sold.  No...

Interesting comment on the Scandium.  BFS assumes 10% sold.  No market for the other 90%.  Don't get excited about scandium.  It's a wild card.  Great if it pays out due to increased demand.  Another scenario is this excess production kills the prices in this small market and $1000/kg becomes a distant dream.  Safest to ignore scandium for valuations right now.

Revenue breakdown in BFS is 65% nickel, 32% cobalt, 3% scandium.  This is a nickel mine, with cobalt by-product. 

Also, seeing some comments on nickel and cobalt price assumptions used in BFS.  Who cares?  There is a sensitivity analysis near the back, with chart and graphs showing IRR/NPV impact of a range of commodity price assumptions.  Pick whatever price combos you want to from that chart for your own valuation and conclusion.  Every serious investor has their own price deck for cash flow and valuation calcs.

Far more important to look at capex + op costs vs other existing mines and other development stage projects.  Would this survive in the bottom of the cycle?  Where does it rank overall in the market?  You want something that can survive tough times, and rake in profits during good times.  It's the most important part of the analysis for investing/financing decisions.  And you won't find the info you need in the presentation released with the BFS summary.

Here's my take on the relative ranking.  For a project this size, the capex probably looks a bit high.  But it's long life, and very low ongoing op costs.  Investors love that stuff, and are willing to pay up front for it, so they won't be scared by the initial capex. With a serious buyer committed take the product, I think this can get financed.

Overall, no surprises in the BFS.  About what we all expected.  Nice fat operating margins, but a mediocre IRR due to the billion dollar up-front capex for the processing plant.  Key thing now is how much project value is retained by existing shareholders as full finance package comes together.  It's a balancing act.  High debt/low equity preserves value for current shareholders, but makes the company vulnerable to any setbacks.  Low debt/high equity makes company more robust, but dilutes existing shareholders.  Hope to see a big offtake prepayment or stream deal.  To minimise debt and dilution.  But no cash is free.

Keen to see how this shapes up in coming months.