Critical Elements' Rose gets post-tax IRR of 82.4%

Critical Elements' Rose lithium-tantalum project gets post-tax NPV8% of $1.9B and IRR of 82.4%

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The results compare to a 2017 FS that projected an IRR for the project of 34.9% after tax, with a NPV of C$726 million (US$566.32 million) at an 8% discount rate.

The FS views a mine life of 17 years with a total mill feed of 26.3 million tonnes. The after-tax payback period is expected to be 1.4 years.

The average year 2 to year 16 production is envisioned to be 173,317 tonnes of chemical grade 5.5% spodumene concentrate, 51,369 tonnes of technical grade 6.0% spodumene concentrate, and 441 tonnes of tantalum concentrate.

The average mill feed grade is 0.87% Li2O and 138ppm Ta2O5. Lithium concentrate production is expected to consist of 75% chemical grade and 25% technical grade.

The parameters used for the FS was an open pit mining rate of 1.61 tonnes per year with a spodumene process plant of 4,600 tonnes per day capacity.

The study estimates an initial capital cost of $357 million before working capital with an anticipated construction time of 21 months.

Average annual EBITDA is projected to be $379 million.

The estimates assumed average prices over the life of mine of $1,852 per tonne and $4,039 per tonne of chemical grade and technical grade lithium concentrates, respectively, and $130 per kg Ta2O5 contained in the tantalum concentrate.

"As the market faces a structural supply deficit for the remainder of this decade, prices are expected to exceed minimum price requirements," Critical Elements said.

Critical Elements share price rose 2% day on day to C$1.47. The company has a market capitalization of C$303.25 million.

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