Centaurus Metals: Nickel sulphides – A$175m cash flow a year for 18 years – that will do!
Centaurus Metals Managing Director Darren Gordon on 3AW, 2GB & 6PR Bulls N' Bears Report
Listen to ASX-listed Centaurus Metals Managing Director Darren Gordon talk to Matt Birney on the Bulls N’ Bears Report about Centaurus’ recent feasibility study on its nickel sulphide project that looks set to ride the next battery metals high tide.
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Centaurus owns the advanced Jaguar Nickel Sulphide project in Brazil. The company recently tabled a feasibility study on the project that shows both capital and operating costs at the lower end of the curve globally for similar projects.
RADIO INTERVIEW - TRANSCRIPT
Matt Birney - Welcome to Bulls N' Bears brought to you today by nickel sulphide developer Centaurus Metals.
Matt Birney - ASX code: CTM
Matt Birney - I'm Matt Birney and I'm joined now by the Managing Director of Centaurus Metals, Darren Gordon
Matt Birney - Hi Darren
Darren Gordon - Hi Matt
Matt Birney - Okay so Centaurus owns the advanced Jaguar Nickel Sulphide project in Brazil. The company recently tabled a feasibility study on the project that shows both capital and operating costs at the lower end of the curve globally for similar projects.
Matt Birney - Okay Darren can you orientate me a bit. Where exactly is your Jaguar nickel sulphide project and what's the region around it like for mineral discoveries generally?
Darren Gordon - Yeah we're in the northern part of Brazil, in the state of Pará, it's in the Carajas mineral province which is a prolific mineral belt globally, dominated by Vale, but with a number of other fairly large mineral developments ongoing right now.
Matt Birney - What's the resource at this project?
Darren Gordon - We're 109.2 million tonnes at 0.87 per cent nickel for 948,900 tonnes of contained nickel and with the feasibility study just out, we had a JORC ore reserve of 63 million tonnes at 0.73 per cent nickel for 459,200 tonnes of contained nickel metal.
Matt Birney - Okay lets get into that feasibility study with some rapid fire questions and answers.
Matt Birney - Firstly, what will it cost to build this project?
Darren Gordon - We're looking at $371 million US dollars.
Matt Birney - How long will it take you to pay that capital back?
Darren Gordon - About 2.7 years
Matt Birney - Alright, how much nickel will you turn out a year? and for how many years?
Darren Gordon - Looking at an average of 18,700 tonnes of nickel per year on an 18 year project life just from open pitable sources.
Matt Birney - Have you wrapped a Net Present Value around the project in today's money?
Darren Gordon - Yeah $997 million Australian dollars with an IRR of around 31 per cent. Both on a post tax basis.
Matt Birney - How much money will this thing make a year? Let's go with annual free cash flow from the operation.
Darren Gordon - Yeah we're looking at about $118 million US dollars which depending on whatever exchange rate you use is about $175 million Australian dollars per year.
Matt Birney - What's your predicted all-in sustaining cost to produce a pound of nickel in US dollars?
Darren Gordon - $3.57 per pound so very good operating cost in the lowest quartile on a global basis
Matt Birney - And what sort of nickel price per tonne did you use for these numbers?
Darren Gordon - We used $19,800 which is about $9 per pound but we've run sensitivities down to $17,000 and it works very comfortably at those levels.
Matt Birney - Do you see any upside to the resource beyond that initial 18 year mine life?
Darren Gordon - Oh absolutely, like there's mineralization below the open pits which should grow the resource. There was 50,000 meters of diamond drilling in 2023 that hasn't made its way into the resource as yet.
Matt Birney - Darren Gordon from Centaurus Metals.
Matt Birney - Thanks for joining me on Bulls N' Bears and remember we're only here to give you information, not advice, which you should of course seek independently.
Matt Birney - I'm Matt Birney and this is Bulls N' Bears.
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