The updated PEA by Sacré-Davey Engineering put initial capex at US$2.8 billion for a 30-year operation, with an after-tax NPV (8% discount) of $575 million and IRR of 10%.
It is a substantially reduced minelife from the 82 years envisaged in the 2018 PEA, which had also put capex at $2.8 billion but the after-tax NPV (5%) at $5.7 billion and IRR at 25% calculated over a 40 year period.
The company, which refers to itself as CuMoCo, said the main reason for the changes in economics included the use of coarse instead of finer mineral sorting intervals, which would result in a decrease of approximately 31% in grades and thus recoverable metals.
It noted an increase in cost per pound for molybdenum (net of products) from $2.37 to $4.64/lb, and an increase in operating cost per tonne from $7.86 to $9.25.
The latest analysis is the fifth report on CuMo since 2008 and it removed tungsten from the resource and its recovery plant from the process plant design, with CuMoCo saying further work was required to determine the best way to recover the tungsten.
"The CuMo project is the largest molybdenum, silver and rhenium deposit in the United States and one of the world's leading mining projects in terms of its size, cost, and potential economics," president and CEO Shaun Dykes said.
"The results are extremely encouraging, especially indicating a potential total after-tax, prior to capital removal, undiscounted cash flow of $11 billion dollars over a period of 30 years ($368 million per year)."
He said optimisations and further studies would be examined in more detail as part of a prefeasibility study CuMoCo would start next year, "with the goal of continuing to further reduce overall capital and operating costs and improve the already excellent economics" of CuMo.
CuMoCo reported a working capital deficiency of about C$5 million (US$3.8 million) at March 31.
Its shares haven't traded in about a year.
It had been issued a cease trade order 12 months ago over deficiencies in a 2018 technical report and in October 2018 retained SRK Consulting to prepare a new report.
