RE: ilmenite concentration plant newsNewfNewf wrote: How hard would it have been to simply provide a sentence statng that based on todays pricing Largo is expected to add X revenue per year and the expected the payback on capital will be 12-18 months. I like details and little guidance coming from the company in their news releases.
Sharpen up the PR Largo!
I agree. But I must add that the way I understand it is that today NR talks about the construction of a new ilmenite concentration plant at a cost of ~US$25.2M (see Note 1 below). This is not the big US$124M Titanium project in Q2-20 (see Note 2). Or maybe I’m wrong?
Note 1
Largo Resources Ltd.'s board of directors has approved the construction of a new ilmenite concentration plant.
Commercial production from the new plant is expected early in 2023 and the plant's capacity will be approximately 150,000 tonnes of ilmenite concentrate per annum. The Company started an ilmenite pilot plant in October 2019. Based on the promising results, the Board approved construction of a full-scale plant. The advanced engineering and construction of the ilmenite concentration plant is expected to cost approximately US$25.2 million with the majority of these costs being incurred in 2022. The Company is also further evaluating the potential to produce titanium dioxide pigment as a possible follow-on product.
Note 2
James Young
Okay. So what kind of -- if you're going? When is -- when are you expected to start this the titanium dioxide plant? And when is it expected to be completed? And what kind of an IRR or ROE, are you expected to generate off of this $124 million investment?
Paulo Misk
Jim, it's -- we are concluding the Kimco pilot plant test work. We are starting -- we have produced already the pigment at lab, but I'd like to confirm in a pilot plant, exactly to have enough material to send to the market. The pigment is not a commodity product. Pigment is a very specific -- it's a special product, which we need the test in the customer -- in the market, how they accept our material.
So, we are doing that step. We do all these studies and characterization in our product, to be sure exactly what we have in terms of revenue and everything. And we haven't done this yet.
Another step of this project, which is -- we are still doing is as I'm getting the titanium reserve and resource, the numbers we have from Kimco is really, very, very encouraging. We have the same situation in other ore bodies, but we need to measure it.
And we are doing all the exploration work and we're doing all the mining plan considering the titanium. So, it's a huge work. It's going to create a very strong and robust operation in Brazil, having two revenue streams. So, I cannot give you the IRR at this time. But I'm sure that you're going to be happy when you see the final numbers by Q1 next year.