PEAK RARE EARTHS LIMITED Peak Rare Earths Limited announced the completion of a Bankable Feasibility Study Update on the Ngualla Rare Earth Project. The BFS Update follows a Bankable Feasibility Study ("BFS") that was completed in April 2017. Both the BFS and BFS Update are backed by extensive pilot plant test work, detailed engineering design and cost studies and JORC 2012 Compliant Ore Reserves and Mineral Resources estimates.
The BFS Update was commissioned in August 2021 to reflect a material improvement in the outlook for Neodymium-Praseodymium ("NdPr") Oxide prices, an expansion in production capacity, movements in capital expenditure and operating costs, optimization opportunities, a reduction in carbon footprint and the potential to further de-risk development. Initially the BFS Update was to cover both the Ngualla Project and the Teesside Refinery. However, following a decision to defer the selection of a refinery site until the completion of an independent study on the feasibility of an in-country Tanzanian rare earth refinery, the BFS Update on the Teesside Refinery has been put on hold.
The BFS Update on a standalone Ngualla Project supports a technically robust project with an increased capacity and highly attractive economics and shareholder returns. Bankable Feasibility Study Update supports a technically and economically robust standalone Ngualla Rare Earth Project. Under a recently announced staged integration and development approach: Ngualla Project to be initially developed on a standalone basis to produce a high-grade rare earth concentrate for export to third-party refiners; and Depending upon the outcome of an independent study into the feasibility of a Tanzanian refinery, the potential to develop further downstream processing in either Tanzania or at Peak's Teesside site in the United Kingdom; Reasons for adopting a staged development approach: Supports the Government of Tanzania's policy of maximising in-country processing and value addition where feasible; Substantially reduces upfront capital expenditure and funding requirements; Lowers commissioning and technical risks around the concurrent development of the Ngualla Project and a rare earth refinery; and Capitalises on growing offtake appetite for high-grade rare earth concentrate.
BFS Update follows a BFS completed in 2017 and reflects a 14% increase in annual production capacity and optimisations relating to reagents, flotation collectors, power plant, tailings storage and logistics. Post-tax NPV(8%, real) of USD 1,483 million (AUD 2,353 million) and an equity IRR of 37.3% based on Adamas rare earth pricing forecasts and USD 321 million upfront pre-production capital expenditure. Ore Reserves of 18.5Mt at 4.80% TREO comprising of 21.26% NdPr.
An initial life-of-mine of 24 years based on Ore Reserves, with Ore Reserves accounting for less than 20% of the Mineral Resource of 214Mt at 2.15% TREO. Average annual concentrate production of 18ktpa (contained TREO) over the first 6 years and 16ktpa over the life of the project; Concentrate benefits from a high grade, high NdPr ratio and low levels of radionuclides (thorium & uranium) and acid consuming minerals. Front End Engineering and Design and cost optimisation studies to be completed ahead of a target Final Investment Decision by 31 May 2023.
