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Copper Peer Comparisons (Undeveloped Projects, Ore Reserves, PFS or FS), page-26

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Clark888

3,875 Posts.

1229

25/02/21

09:00

Post #: 51307075

Originally posted by Clark888 ↑

With a thinning copper project pipeline in Australia, in my opinion, all 4 of these undeveloped copper projects with JORC Ore Reserves will get up (even Hillside).

View attachment 2941166

The following table articulates why Havilah has the best risk-reward equation across the undeveloped Australian copper peer comparison for the ASX listed mining junior pack: Kalkaroo is number 1 or 2 in most categories (particularly where it counts: NPV and IRR).

Column 1 Column 2 Column 3 Column 4 Column 5

1

2

3

4 PROJECT: Kalkaroo Hillside Sulphur Springs Jervois

5 Project funding in place? No No No No

6 Primary commodity Copper-gold Copper-gold Copper-zinc Copper

7 ASX Company HAV RXM VXR KGL

8 Copper JORC Ore Reserve: Proved 430Kt (90%) 260Kt (51%)

9 Copper JORC Ore Reserve: Probable 44Kt (10%) 249Kt (49%) 119Kt (100%) 226Kt (100%)

10 NPV (pre-tax) A$M $903 $751 $472 $177

11 IRR (pre-tax) 26% # N/A 51% 23.0%

12 IRR (post-tax) 21% # 16.2% N/A N/A

13 Discount rate 7.5% (2019) 5% (2020) 8% (2018) 8% (2020)

14 A$/US$ rate 0.75 0.70 0.72 0.71

15 Copper price US$3.10/lb US$3.00/lb US$2.86/lb US$3.08/lb

16 Gold price US$1,500/oz US$1,550/oz N/A US$1,850/oz

17 Zinc price N/A N/A US$2,650/tonne N/A

18 Silver price N/A N/A N/A US$22.80/oz

19 Waste: Ore ratio 3.5:1 6.7:1 (after pre-strip) 8.7:1 4.9:1

20 Life of mine minimum 13 years initial 12 years initial 10.3 years initial 7.5 years

21 Location from port 350 km 150 km 144 km 1,700 km

22

23 Any other copper project? Mutooroo No Whims Creek, WA No

24 Any other mineral projects? Grants Basin (Fe), South Australia Hog Ranch (Gold), USA No No

# IRR is based on original Kalkaroo 18 June 2019 PFS long-term copper price of US$2.89/lb and gold price US$1,200/oz.

Three of these copper juniors in Australia are still very much undervalued compared to their copper project’s NPV.

Column 1 Column 2 Column 3

1

2

3

4 % of NPV (pre-tax) Market cap A$M ##

5 Havilah 7% $63

6 Rex Minerals 9% $66

7 Venturex 9% $41

8 KGL 87% $154

## As of last Friday.

The irony, Jervois project has the lowest NPV but KGL Resources Limited has the highest market capitalisation.

Copper futures (Mar'21) currently US$4.12/lb. That is definitely not factored into the current share price for the likes of HAV, VXR or RXM.

Cheers

These are only my thoughts and it does not constitute investment advice. Before acting on any information you read and before making any financial or investment decisions, you should always consult your advisor(s) or other relevant professional experts.

Expand

For those that are interested, the Yardeni 'Copper Market Correlation' charts can be found here:

https://www.yardeni.com/pub/coppercorrel.pdf

Currently, there are only 6 undeveloped copper projects in Australia with significant JORC Ore Reserves, that also have a Pre-Feasibility Study or Feasibility Study. Four of the 6 are owned by Australian junior exploration companies.

That is a razor thin Australian copper development pipeline.

Reminder: 10 years ago the LME 3-month official copper prices surged to a high of US$10,124 per tonne (US$4.60/lb) during February 2011 from a low of US$1,340.50 per tonne (US$0.61/lb) during early November 2001, according to Fastmarkets’ price archives.

Cheers

These are only my thoughts and it does not constitute investment advice. Before acting on any information you read and before making any financial or investment decisions, you should always consult your advisor(s) or other relevant professional experts.

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