WR1 General Discussion, page-7112

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iamagenius

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10/02/23

22:34

Post #: 66190012
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Originally posted by dtab ↑

What is CE's plan for Cancet?

In short: modular, incremental DMS-only production ASAP. A reserve of a few million tonnes of high-grade, shallow, coarse spodumene, initially produced at a rate of 50-100ktpa. This suggests a ~0.5Mtpa DMS plant to start with, i.e. 500kt ore * 1.3% head grade * 70% recovery = 75ktpa SC6. At 3000 usd/t margin = 215-430m aud EBITDA /yr from the low capex plant. The massive IRR can be used to quickly to fund expansion. That's the beauty (and opportunity) of deposits suitable for the DMS-only model: you can start small and scale fast.

CE tells us his plan in the July 2022 interview with RK Equity:

Watch from 5:52

Rodney Hooper: "you've done some metallurgical test work..."

Chris Evans: "yes, metallurgical test work was done on a representative sample from drill cores over a number of drilling campaigns, and from average grades of 1.5 - 2% a 6% concentrate was made, no problems, and that's essentially on an unoptimised flowsheet, which leads us to believe we can start this in an incremental manner. So the amount of drilling that's been done at the moment is enough to, in theory, produce a JORC resource, which hasn't formally been wrapped around it yet, but with a few million tonnes, starting with one DMS module, there's three or four years of operation producing in the region of 50 to 100ktpa of SC6, and then we can ramp up as our exploration increases."

Rodney Hooper: "Near term, you can be to market quickly then?"

Chris Evans: "That's right, very near term, because it's an understood technology. And when I say near term for an advanced exploration, I see us only as one drill season and then a short while later we could be in production."

We only need the permits, and then we can start producing SC6 at Cancet.

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That’s nice ebitda it can easily be double

WR1 Price at posting: $2.04 Sentiment: None Disclosure: Held
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0 Great analysis

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WR1 General Discussion, page-7112

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