Impact: Positive
Cordoba Minerals reported FS results for its 50%-owned Alacran project in Colombia. The study outlines a 14.2-year LOM and initial capex of US$420M, which generates an after-tax NPV8% of US$360M, IRR of 23.8% and three-year payback period (PFS was US$415M at a 25.4% IRR), using higher metal prices of US$3.99/lb Cu, US$1,715/oz Au, and US$22.19/oz Ag (was US$3.60/lb Cu, US$1,650/oz Au, and US$21/oz Ag). Overall, we view the FS positively for Cordoba as both initial and sustaining capex declined slightly, likely given a right-sized processing facility with a cheaper/simpler gravity circuit alongside the main flotation circuit. Despite the higher cash costs and ~13% lower NPV for the project, we view the FS as more robust than the PFS and believe it helps de-risk the project, given that 30-40% of total engineering has been completed to support the capex calculation. We note that the FS only contemplates mining one of the four known deposits (Alacran) at San Matias, leaving plenty of room to further augment the mine plan and improve these economics.