What a difference a year can make, last year when the pea came out it had an npv of 18million dollars,
at that point, anybody holding the stock wanted to head to the nearest bridge. However since then a few things have happened, we now have the dodd frank conflict minerals law now in effect, we have an increase in the resource update, and of coarse the prices of tantalum and niobium have gone up. So what does this all mean?
The project is a lot more valuable, Many producers and users of tantalum in their products have to source conflict free tantalum, and guess what its not out there, and i would imagine there is more then a healthy premium for it. In africa the have a tag and bag system set up for conflict free tantalum, but really its a matter of time before the greed takes over, and one will be able to buy it on the black market, or counterfiet ones will be made, its just human nature.
So lets simply take a look at what the increase in price and resource mean for the project.
a couple of assumptions first
the costs will not change as we are looking at price increase
the math is simple and consevative, the information has been gathered from the resourse update and the pea. current pricing of conflict mineral has been taken from the newest metal miner published price.
updated mineral indicated and inferred
tantalum 11500000 kgs
niobium 91500000 kgs
current price of conflict tantalum con 130/lb, 24065/lb oxide price with a 25% premium for conflict free, pea price 70/lb oxide price145
current price of niobium oxide 45-60 dollars so say 50 pea price 31/kg
so if we say we will lose 1/2 the kgs in tantalum and niobium because of it not being mined and recovery to oxide we end up here
tantalum 5750000kgs x2.2 to get lbs= 12650000lbs
niobium say 45000000kgs
tantalum 12650000x $95(difference between todays pricing and pea)=$1,201,750,000
niobium 45,000,000x $29 (difference between todays pricing and pea)=$1,305,000,000
in the updated resource calculation the mine life went from 10 years to 12 years and say costs are 100mill per year
straight profit or npv goes to rghly 2.3billion
like i said this is a merely simple calculation to show what the increase in price has done the niobium price i saw on a chineese website for oxide was 60-65 fob china dont know how accurate it is but you get the idea.
we are sitting on 2 very valuable assets and with the trouble going on in the DRC Congo blue river would be my guess to getting an jv partner first. for any info on the drc goto bbc.com.
hope this helps good luck to all dont sell them so cheap a few people can see this potential
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