@HiDiHi has covered a lot of it but I'm just extrapolating from the SS' numbers.
I definitely not believe it will happen, but let's say the JV drops out and we stick to producing concentrate.
I'm taking the 4mtpa mid-point numbers :
0.52% Head grade
65.9% Recovery
13.35$us/t ore mining cost
11.85$us/t processing cost
I am assuming they've already factored mining dilution in the mining/processing costs.
For 1t of Nickel equivalent in concentrate we get cash costs of :
1/(0.0052×0.659) × (13.35 + 11.85) =7358$us/t
Cash costs to AISC seems to be ~+12% from the presentation.
Gives us 7358 × 1.12 = 8237$us/t AISC.
Ni spot price is at 15800$us/t, 70% of that for concentrate is 11060$us/t.
Let's assume we sell it to a refinery in Vietnam, avoiding any tariffs.
Margin of 2823$us/t, at 12.7ktpa => 35.8m$us per annum
There would be around 200m$us of capex for that scenario taking the refinery and some contingency out.
Add some taxes and an 8% discount rate and it starts to be a bit of an uphill battle to repay the Capex in time, get a decent IRR and any NPV out of this.
I reckon Scott realised all that a while ago and that's why he's going all out on the exploration and partnerships. That's where all the value will be unlocked.
The MSVs seem to have decent grades and amazing Cu/Co/PGM by products in the district. A 20-80 blend would completely transform the economics here.
Better head grade, better recoveries, producing copper and pgm concentrates, potentially removing the need to purchase cobalt sulphate to feed the JV.
We already know the upside from the JV as even the base case looks very good.
We also know that Ta Khoa is something special.
There's not many places in the world where you have high grade Ni/Cu gossans all over, ready to be tested.
A combination of exploration successes, the joint venture going ahead and a nickel shortage (which all have decent chances of happening) would obviously make this skyrocket and I'm assuming that's why we're all here.
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