Commerce reports Quebec REE PEA of $763M CAPEX, 44% IRR, $2.32B NPV, 10% Discount Rate, 2.25-yr Payback, 25-yr Life
Commerce Resources Corp TSXV:CCE announced a preliminary economic assessment for the Ashram Rare Earth Element Deposit on its Eldor Property in the Labrador Trough of northeast Quebec. The study projects a 4,000-tonne-per-day open-pit mine with a pretax/pre-finance payback period of 2.25 years, a CAPEX of $763 million (including a 25% contingency amount), a pretax/pre-finance internal rate of return of 44%, a pretax and pre-finance net present value of $2.32 billion (at a 10% discount rate) and a 25-year mine life.
The operating cost is estimated at $95.20 per tonne treated or approximately $7.91 per kilogram of rare earth oxide produced. Annual production is estimated at an average of 16,850 tonnes REO over the life of the mine, including 2,870 tonnes neodymium oxide, 96 tonnes europium oxide, 26 tonnes terbium oxide, 106 tonnes dysprosium oxide and 440 tonnes yttrium oxide.
President/CEO David Hodge commented, “The PEA displays robust economics for the Ashram Deposit and recommends the next steps for the economic evaluation of this very large and highly strategic resource. The high NPV derives partly from the value of the Ashram material in that it is enriched with all five of the critical REEs, namely neodymium, europium, dysprosium, terbium and yttrium. Management believes that significant benefits will be further realized during the next phase of metallurgy based on the test work completed to date, given the deposit’s simple mineralogy and history of successful commercial processing of Ashram’s three host minerals. We look forward to initiating the prefeasibility study to demonstrate this.”
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by Greg Klein