Key points from this brilliant article today. Anyone having...

Key points from this brilliant article today. Anyone having doubt about PFS should read it:

https://s t o c k h e a d.com.au/resources/magnetite-mines-builds-razorback-momentum-with-pfs-plan/

please remove the spaces (s t o c k h e a d)

1. Current prices are almost double the level used to generate these results (As per the PFS).

2. The case selected by Magnetite – known as the head grade improvement case (HGIC) – is based on higher mining rates than the PFS reference case, with a head grade upgrade from selective mining or ore sorting. It would produce 2.7 million tonnes per annum of high-grade concentrate over an initial mine life of 23 years.

3.The company won’t need to build its own power generation infrastructure, contributing to the low capex outlined in the PFS, while the grid’s use of renewables ties in with Magentite’s commitment to building a project and organisation with sustainability at its heart.

4. Importantly once built, the project would continue to generate returns after all costs and sustaining capital to a trough price as low as $54/cost and freight tonne at a 62% iron basis.

5. “This small-scale startup allows for a practical development of a long life, high quality business with a targeted date for first ore on ship at the end of 2024,” chief executive officer Peter Schubert noted in the PFS release.

6.“Increasing the head grade to the plant gives us more throughput for a similar footprint, leading to output increase and cost efficiencies in processing.” he said.

7. The numbers above are measured against an 62% fines iron ore price of US$110/t. But given the 62% iron ore fines price has averaged about US$184CFRt in the six months to the end of July, the company has also estimated post-tax NPV and IRR at $1,544m and 33% respectively using a higher, US$150CFR/t price.

8. That tenement, around 110km northeast of Razorback, has an inferred resource of 1.5 billion tonnes in its own right.What this means is that with further evaluation, the company can easily convert more of its resources into reserves that could extend mine life or fuel expansions.Plant scale in the study was also limited to ensure capital costs were kept to a manageable level, and mine life was capped at 30 years –which leaves considerable upside into the future.