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Elementos’s scoping study for the Oropesa tin project: how does it compare to its tin peer group?

Elementos is planning to follow up this study with a definitive feasibility study alongside finalising the environmental permitting for the project.

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Elementos Limited (ASX:ELT) has completed a scoping study at its 100%-owned Oropesa tin project, located in Spain.

The conventional open-pit operation would produce a tin concentrate that could be shipped to smelters in Europe or Asia.

The scoping study returned a post-tax net present value with an 8% discount rate (NPV8) of US$66mln with a post-tax internal rate of return (IRR) of 22% using a tin price of US$19,750 per tonne (t), which is very conservative compared to a peer group that uses prices between US$25,000/t and US$17,300/t, averaging US21,222/t (Figure 1).

Figure 1 Eleementos

Figure 1: Tin Peer Group Prices Used in Economic Studies

Source: Mining & Metals Research Corporation

The mine is expected to produce 2,440t of tin in concentrate over a 14-year life-of-mine; compared to its peer group it would be a relatively small tin operation (Figure 2) on a per annum basis but it would have a long mine life (Figure 3).

Figure 2 Elementos

Figure 2: Tin Peer Group Annual Production Rates

Source: Mining & Metals Research Corporation

Figure 3 Elementos

Figure 3: Tin Peer Group Life-of-Mine

Source: Mining & Metals Research Corporation

Compared to the same peer group Oropesa is at the higher end of the cost curve at US$11,534 (C1) but at the lower end of the capital expenditure (apex) curve with a capex of US$52.23m, which should be fundable for a junior of Elementos’s size. The project is mid-range in terms of life-of-mine capex intensity at US$1,528/t (Figure 4).

Figure 4 Elementos

Figure 4: Tin Peer Group Opex and Life-of-Mine Capex Intensity

Source: Mining & Metals Research Corporation

Elementos is planning to follow up this study with a definitive feasibility study alongside finalising the environmental permitting for the project.

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