Caravel Minerals add A$0.6B to NPV

Caravel Minerals reported the outcomes of an independent metallurgical process review and update completed recently for its 100%-owned Caravel Copper Project, located 150km northeast of Perth in Western Australia. The results identified substantial opportunities to enhance Project value and confirmed the process flowsheet's suitability before the start of engineering for the Definitive Feasibility Study (DFS). The three-month review was undertaken by industry specialist engineering and project delivery firms Lycopodium Minerals (Lycopodium) and Orway Mineral Consultants (OMC). The key outcomes of the review support an incremental increase in process plant capacity of ~10% to 30Mtpa undertaken by Lycopodium and OMC, including a Molybdenum Recovery Circuit (MRC) undertaken by Caravel Minerals and the deferral of the previously considered Coarse Particle Flotation (CPF) circuit. Based on these changes, forecast annual copper production increases from 60ktpa to ~65tpa at steady state, supplemented by ~0.9ktpa of molybdenum production as a saleable by-product.

The combined financial benefits of these changes are significant, with Project NPV increasing by ~A$0.6B to ~A$2.0B and Project payback reduced to less than five years. All-in Sustaining Costs decrease by ~14% to ~US$2.07/lb of copper produced, and IRR increases to 21%. Following the completion of the review, the base case process flowsheet for the DFS has now been established. The DFS is scheduled for delivery in the first half of 2024.

Caravel Managing Director and CEO, Don Hyma, said: “Our decision to commission a wide-ranging independent metallurgical review of the Caravel Project flowsheet by leading engineering group Lycopodium, supported by a group of consulting technical experts, reflects our commitment to exhaustively analyse all aspects of the Project and to strive to ‘build it right’ from the beginning. “The results of this review and update have exceeded our expectations. The increase in copper production stems from relatively minor changes and enhancements to the project flowsheet, in combination with the inclusion of the previously flagged Molybdenum Recovery Circuit. Collectively, these changes result in a significant increase in Project cash-flow, NPV and financial returns for a modest increase in capital expenditure. Importantly, we have also used a modest assumed price of US$4/lb for copper and US$20/lb for molybdenum – with significant scope for upside on these prices. “The outcomes of this review will now be ‘frozen’ into the detailed engineering phase, and we are delighted to announce the appointment of Lycopodium as the Lead Engineer for the Definitive Feasibility Study, which will get underway in earnest in the second half of this year.”