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  4. First Phosphate announces positive results of preliminary economic assessment at its Begin-Lamarche property

First Phosphate announces positive results of preliminary economic assessment at its Begin-Lamarche property

 

Published by
 World Fertilizer,

First Phosphate Corp. has announced the positive results of its preliminary economic assessment (PEA) on the Bégin-Lamarche Property located 75 km northwest of Saguenay, Quebec, Canada.

The PEA provides a potentially viable case for developing the Property by open pit mining for the primary production of phosphate concentrate and secondary bi-product recovery of magnetite concentrate.

Highlights:

  • The project would produce an annual average of 900 000 t of beneficiated phosphate concentrate at 40% P2O5 content and 380 000 t of magnetite at 92% Fe2O3 content over a 23-year mine life.
  • The project generates a pre-tax internal rate or return (IRR) of 37.1% and a pre-tax net present value (NPV) of C$2.100 billion at an 8% discount rate at an approximate 3-year trailing average phosphate price plus a premium for purity and potential secure source of supply, and a 2-year trailing average magnetite price plus a premium for purity.
  • The project generates an after-tax internal rate or return (IRR) of 33.0% and an after-tax net present value (NPV) of C$1.590 billion at an 8% discount rate.
  • The project would generate an after-tax cash flow of C$700 million in years 1 - 3, resulting in a 2.9-year payback period from start of production. Pre-tax cash flow in years 1 - 3 is C$783 million for a 2.6-year payback period.
  • The project benefits from adjacent paved provincial road access and nearby electrical power line, and year-round accessible deep-sea Port of Saguenay at approximately 85 km driving distance. Initial capex for the project is limited to C$675 million.

The PEA used Indicated and Inferred Mineral Resources in its calculations.

The project has no outstanding royalties or financing streams registered against it.

"We are pleased with the results and timely completion of this PEA. Existing local infrastructure keeps our CAPEX low, our mine size controlled and our mine economics robust," says First Phosphate CEO, John Passalacqua. "Our internal pre-feasibility work is also near completion and we are now in a position to determine the timing on our feasibility study."