A key point I forgot to mention - as the feed grade for the...

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Ubique13

910 Posts.

3383

12/02/21

15:17

Post #: 50938070
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Originally posted by Ubique13 ↑

Good points that highlight how conservative the DFS was & how much upside there still is on the $1.7B NPV. I expect when in production, costs will fall in line or even lower than the $281/t OPEX given by the feasibility study unlike West Australian peers whose actual OPEX blew out way past their estimates.

A big point to be aware of, the latest met testwork demonstrates overall recovery of 87%, however 77% was used in the DFS to be conservative. If the mine can deliver recoveries of 87%, this increases production from ~440ktpa to ~500ktpa, and will reduce OPEX materially.

You don't need to be in the data room to be able to tell that our friends in the DRC are in serious trouble with highest OPEX of peers, only to increase when transport costs are estimated accurately.

Not many other economic projects left, and FFX's project - a lowest cost quartile producer will be in high demand.

It is no surprise that the big players in the lithium game are falling over themselves to get a piece.

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A key point I forgot to mention - as the feed grade for the first 5 years will be ~1.74% Li2O, this will further increase throughput and reduce OPEX.

If we assume 1.74% head grade & 87% recovery, we're looking at ~575ktpa production up from 440ktpa. With this increased production and reduced OPEX, we'd be looking at EBITDA of ~$340M up from ~$240M.

FFX's resource is high grade and outcrops from surface with large, very high grade (>2%) zones at surface - a huge advantage for us.

Easy to see why our friends over the fence are so nervous about our huge, simple and low cost project.

Last edited by Ubique13: 12/02/21

FFX Price at posting: 24.5¢ Sentiment: Buy Disclosure: Held
53 Upvote

13 Great analysis

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