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Blencowe Resources PLC - London-based mining company - Says definitive feasibility study confirms ‘outstanding economics’ for its Orom-Cross graphite project. Says DFS assesses an initial 15-year life of mine and that it expects ‘significant’ extensions ‘as further drilling converts additional resources to reserves’, since only around 2% of the deposit is drilled so far. DFS highlights include a net present value of $1.09 billion, average annual earnings before interest, tax, depreciation and amortisation of $230 million per year over the LOM, and free cash flow of $2.03 billion over the initial 15 years. Also, DFS gives Orom-Cross a 96% projected internal rate of return and all-in sustaining costs of $485 per tonne over LOM. Company says the project will start with phase 1 production, and that its ‘primary corporate focus’ is the ‘immediate next step’ of securing the funding package to initiate ordering, construction and commissioning. It will implement phase 2 within two years of P1 commissioning.
Executive Chair Cameron Pearce comments: ‘Achieving such strong NPV and IRR metrics from a relatively low capital base is a world-class outcome. It is rare to see a project with such consistently strong fundamentals across scale, cost structure, margins and downstream potential. This study marks a transformational moment for Blencowe...The DFS confirms Orom-Cross as a Tier-1 graphite project and our focus now turns to the financing process and delivering first production as our next major goals. With the project now considerably de-risked, graphite markets improving, and a clear pathway to become a major ex-China supplier, we believe Blencowe is exceptionally well positioned for a meaningful re-rating as investors realise the scale of the opportunity ahead.’
Current stock price: 8.50 pence, up 6.9% on Monday in London
12-month change: more than doubled from 3.70p
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