VanadiumCorp Resource Inc. [VRB-TSXV] has announced a positive independent Preliminary Economic Assessment (PEA) has been completed for its 100%-owned Lac Dore Vanadium Project situated 30 km southeast of Chibougamau, Quebec. The project is to produce vanadiferous titanomagnetite (VTM, magnetite) concentrate from the Lac Doré deposit, which will either be processed using the company’s VanadiumCorp-Electrochem technology or marketed to third parties. Highlights of the PEA base case include:
- After-tax Net Present Value (NPV) of CDN $814M, post inflation but not discounted
- After-tax Internal Rate of Return (IRR) of 15.42%
- Pre-tax NPV of CDN $1.057 Billion
- Pre-tax IRR of 17.46%
- Nominal VTM production rate of 864,000 tons per year at a nominal price of US $100/ton
- Average mining head grade of 26.6% VTM
- LOM adjusted to 20 years, requiring 64% of the presently known inferred resources
- After-tax payback period of six years after start-up
- LOM operating margin of 25% including inflation
- Mineralization: 99,104,000 tonnes at 0.43% V2O5 inferred
- Vanadium resource: 282,370 tonnes V2O5or 621,214,00 lbs V2O5 in magnetite concentrate
VanadiumCorp engaged IOS Services Geoscientifiques Inc. to prepare compiling the PEA.
The PEA is preliminary in nature and includes exclusively inferred resources considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as reserves.
Adriaan Bakker, VanadiumCorp’s President and CEO, said, “We are very pleased with the results of this Preliminary Economic Assessment, which clearly establishes Lac Dore as one of the premier undeveloped vanadium resources, located in a favorable jurisdiction for mining development. The PEA illustrates robust economics and marks a significant milestone for VanadiumCorp to continue to advance Lac Dore towards production. The base case shows that Lac Dore could generate more than CDN $1.4 billion in pre-tax net cash flows and deliver life-of-mine, after-tax net present value of CDN $ 814 million. Thanks to the experience of IOS with Lac Dore and vanadium expertise, we have based our economic base case on a conservative magnetite concentrate production model that demonstrates a positive cash flow scenario for Lac Dore and provides ideal feedstock for VanadiumCorp-Electrochem Process Technology. VanadiumCorp-Electrochem Process Technology, tested on vanadiferous titanomagnetite from Lac Doré, is achieving excellent recoveries and scaling toward 1 tonne/month nameplate capacity. With the support of all our stakeholders, including our shareholders, employees, local entrepreneurs, Chibougamau regional communities and the Canadian government, we are looking forward to advancing this outstanding vanadium project to the next stage of development.”