Prophecy Platinum Corp. (CVE:NKL) revised Wednesday its base case metals pricing assumptions for its Wellgreen Platinum group metals-Nickel-copper project in the Yukon.
The junior miner, which originally reported results from the
preliminary economic assessment of the project on July 18, changed the
base case metals pricing assumptions to the London Metals Exchange three
year trailing averages from the Energy and Metals Consensus Forecast.
Prophecy said the decision was made as the long-term London Metals
Exchange pricing method is more commonly adopted in base case studies.
It also noted that it is closer to spot metal pricing, "which offers investors a more balanced view of project economics."
The new base case pricing assumptions see Platinum
at US$1,587 an ounce, compared with an LME spot price of US$1,468 per
ounce and the prior EMCF assumption of US$2,043.50 an ounce.
The LME 3-year trailing price for copper is $3.56 per pound, versus
an LME spot price of $3.49 per pound, and the prior EMCF assumption of
$3.11 a pound.
The LME 3-year trailing price for Nickel is $9.48 a pound, compared with the LME spot price of $7.71 a pound, and the EMCF assumption of $10.82 a pound.
Using the new base assumptions, the project is now projected to have a
net present value of $2.39 billion at an 8 per cent discount rate, a 32
per cent internal rate of return, and a 4.88 year payback period.
This compares with the prior EMCF results of a net present value of
$3.04 billion, a 38 per cent internal rate of return, and a 3.55 year
The company advises that investors should rely on the new base case data. The PEA is expected to be filed on SEDAR in 7 days.
The project was initially expected to produce 1.95 billion pounds of Nickel in concentrate, 2.05 billion pounds of copper and 7.11 million ounces of Platinum plus palladium plus gold over a 37-year mine life, with an average strip ratio of 2.57.
The deposit will be processed using a concentrator to produce bulk Nickel-copper-Platinum group element concentrate.
The company said permits to start construction are anticipated to be
obtained in 2016, with the production of concentrate expected to begin
Last week, the mineral resource company announced that it officially acquired the Nickel and copper producer Ursa Major Minerals.
The merger, which was first announced on March 1, will create a mid-tier resource company with a pipeline of Platinum and Nickel projects, including the Shakespeare Nickel-copper mine near Sudbury, and the Wellgreen project, in Yukon Territory and Manitoba’s Lynn Lake.
Prophecy Platinum is a mineral exploration company focused on developing Platinum group metals and Nickel sulphide projects.