“This initial pit study has encouraged KRC to scale up the vanadium-titanium-iron project Scoping Study to almost twice the size of the planned operation reported in the 2012 Scoping Study”
IMO, this has interesting implications.
KRC is aware of the estimated feasibility metrics
Management, as I expect, would have held earlier discussions with potential strategic partners on Speewah project and has briefed them of this important latest development (a larger plant size).
“The best optimisation identified a pit shell with sufficient material for several decades of production at economically viable mining grades with a low strip ratio of 0.4 tonne waste to 1 tonne mineralised material”.
Project Analysts would be delighted - resource availability to support a lengthy period of production and low strip ratio to support lower mining costs.
On the matter of corporate communication, would KRC have made the statement of a prospective larger plant without consulting with potential business partners?. It would be strange if they didn’t.
In the corporate world, such close communication is common between the parties concerned, notably on major project plans. Both parties will work closely to focus on the feasibility metrics, such as industry outlook for Vanadium (at least over 10 years), resource price trend, level of competition, project production cost, NPV, IRR, capital payback etc. A full feasibility studies (top down approach) will be conducted. The final consideration is whether it meets the minimal ROI hurdle. IMO, I think both parties do have a certain numbers in hand to indicate a preliminary project viability.
With TB’s extensive commercial experience, I expect close consultations have taken place over the past months. In view of the global demand for New Energy, the positive industry dynamics and the scale of Speewah project, I believe there is more than one interested party talking to KRC.
I have examined closely the latest Quarterly Activities Report. Based from my corporate risk strategy experience, there is certainly scope for optimism, coming soon for shareholders.
These are my views. As usual, please DYOR.
KRC Price at posting:
8.8¢ Sentiment: Hold Disclosure: Held
