General Chat / Discussion, page-1968

Makuutu
A 10% increase in the basket price leads to a 30% increase in the npv (slide 10)
The basket price has increased 50% from the SS
This means 150% of $321 usd npv = $481 usd additional npv
Total npv at spot is $321 + $481 = $802 usd npv
Exchange rate of 74c = $1.084b aud
The MRE will upgrade much of the inferred to be able to be included in the BFS, (250mt indicated/resource pg 13). This will have a significant upside to the Makuutu NPV. I'd be inclined to think that they will get some green bonds and/or oem funding to bring on modules 2-5 in the first few years (more aggressive ramp up pg 14). This will have a significant upside to NPV as the cashflows are brought forward. I'd also be inclined to think that they may want to expand the number of modules down the track, but I'd doubt that would for part of the BFS.
I think RE oxide pricing will always oputstrip the discount rate of 8% because I believe that China will use it's dominate market position to make the market price for the rest of the world. If that proves true there is a significant hidden upside to the companies valuation.

Refining
The revenue from refining is approximately the same as the revenue from the Makuutu mining activities ($142 vs $72 ss - pg 11). The revenue from the Makuutu SS for the 11 years is $3.63 b AUD, so we'd expect revenues to be similar from the refinery over the same period. These revenues are available 100% to IXR.

Magnet Recycling
As far as the company is aware no other company can take mixed magnet types and recycle them into individual oxides. This is a global opportunity, and given that the reagents Seren uses are 100% re-usable, the opex will be small and the margins very large. This is a hidden gem. IXR will be able to have a low carbon, urban mine, recycling magnets in country, with low doc permitting. A much faster path to permitting than a mine. Future Govt legislation will mandate recycling, as they've done with batteries in the EU.

The supply fundamentals that China will exert, will underwrite increasing pricing, because who wants to discount a product that they control the market on. You are better to supply your own domestic business and strangle the foreign competition. China are already saying they have no obligation to supply the world, and if so, where is the rest of the world going to get their supply from.

GLTAH