For those interested, I have compared the October 2016 PFS and June 2018 DFS key parameters in the table below. Happy to be corrected on any inaccuracy in the table.
It is true to say that many of the metrics for the 2018 DFS are worse than those derived for the PFS - in my view, the big sell off of Cleantec today is a direct result of this disappointing DFS result. No doubt some will see this as a 'unique buying opportunity' the project as it stands, with an IRR of 19%, is average at best and there are other projects out there that offer better returns. Money will flow elsewhere in my opinion.
Of particular concern for me is the 125% increase in the Unit Capital Cost (US$/lb metal) and the 58% increase in operating cost. The US$4.68/lb metal seems high to me - if I recall, operating cost at Ambatovy, for example, is circa US$3.80/lb metal (I will check this). If this is an 'apples with apples' comparison, which I think it is, what happened to the perceived advantage of Cleantec's proprietary technology? Perhaps the market is getting spooked with technology that is not yet proven on a commercial scale?
Today's second announcement was telling. It's a nothing announcement imo. Perhaps it was put out there immediately after the DFS announcement to soften the blow of a DFS that has not met expectation. Who knows, but it's a strange announcement.
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