Post by
retiredcf on Aug 01, 2024 8:35am
More TD
UPDATED SANTO DOMINGO FEASIBILITY RESULTS — NEXT STEP A PARTNERSHIP
THE TD COWEN INSIGHT
Capstone announced the results of its Santo Domingo feasibility study. Overall financial metrics were better than we had forecast driven primarily by lower operating costs, taxes, and other sequencing factors. We expect a slightly positive reaction to the announcement, but believe investors will likely want to see a partnership on the project before getting more comfortable with its development.
Impact: SLIGHTLY POSITIVE
NPV8% for the project came in at $1.7Bln (TD $0.9Bln) based on an upfront capex of $2.3Bln (TD $2.2Bln), and 19-year mine life producing 68kt of copper and 3.6Mt of iron concentrate per year at life-of-mine cash costs of $0.33/lb copper produced.
Production over the first seven-years of the mine plan is expected to average 106kt of copper and 3.7Mt of iron concentrate at cash costs of $0.28/lb Cu.
Plant and mill — The concentrator will be designed to process up to a maximum of 72,000tpd using Autogenous Grinding milling, with conventional rougher cell flotation, regrinding, and classification and Jameson Cells. Magnetite iron will be recovered from the copper rougher tailings using Low Intensity Magnetic Separation (LIMS).
Key infrastructure includes a greenfield port in the Punta Roca Blanca area 43km north
of Caldera in the Atacama Region III. The port facility is designed to accommodate the maximum throughput requirements of 5.4M tpa of magnetite concentrate and 0.72M tpa of copper concentrate. Infrastructure will also include an iron magnetite concentrate pipeline and a third party-operated desalination plant and desalinated water supply pipeline.
Potential upside of optimization initiatives — The FS does not include the potential synergy upsides associated with integrating aspects of the project with the Mantoverde operation located 35km southwest from SD. These opportunities include:
-
The processing of SD’s oxide material using Mantoverde’s excess SX-EW capacity
-
Recovery of cobalt and additional copper from a pyrite concentrate
-
Ongoing exploration of the MV-SD district, including the recently acquired Sierra Norte deposit
Next steps — The company plans to progress with the assessment of financing options for the project, which may include bringing in a minority partner at the project level. In parallel, the company plans to advance detailed engineering on the project. Capstone plans to release their Q2 results today after the close followed by a conference call at 5 pm ET (416-764-8650).
Be the first to comment on this post