The study forecasts a US$371 million development cost for a concentrate-only open-pit operation producing 18,700 tonnes per annum of nickel over an initial 18-year mine life.
Assuming an average life of mine nickel price of $19,800 and 76% nickel payability, Centaurus has scoped a circa $1 billion post-tax net present value and internal rate of return of 31%.
The operation would have all-in sustaining costs of $3.57/lb.
Nickel prices have slightly recovered from recent lows but still remain severely depressed following a flood of supply from Indonesia. Prices on the London Metal Exchange are currently around $17,300/t.
The concentrator plant would have a production capacity of 3.5Mtpa.
Managing director Darren Gordon said the company was confident Jaguar would be “financially viable in any future nickel price environment”, with its low costs meaning it could compete with the growing laterite sources from Indonesia.
“The low C1 cash costs are largely driven by very low power cost … [and] the size and quality of the project’s nickel sulphide deposits supporting the scale of the proposed operation, State-based indirect tax incentives associated with operating in the Carajas mineral province, and the favourable Brazilian Real exchange rate,” Gordon said.
He said the company was placed to make a final investment decision for the newly revamped project in the June quarter of 2025.
It’s been a long journey for Jaguar, culminating in an eventual strategy shift for the asset after the effective structural reset of the nickel market.
Centaurus in March scuppered its ambition to build an expensive downstream nickel sulphate refinery in favour of a lower capital cost concentrate venture.
It pushed out the delivery of the study, which was at one stage due before the end of 2022, and a subsequent investment decision even further.
Centaurus and its engineering partner, Ausenco, ended up delaying the study target to March 2023, before extending the timetable again to the December quarter of 2023 and once more to the March quarter of 2024.
First production that was once targeted for the end of 2024 is now looking like the second half of 2027, if all goes according to plan with the new concentrate-only operation.
Jaguar has resources of 109Mt grading 0.87% nickel.
Despite the ongoing feasibility delays, Centaurus in February remained on the top of mining investment legend Rick Rule’s list of favourite mining stocks, not least because it had already received environmental impact assessment approval for Jaguar, which was notoriously difficult to secure in Brazil.
Centaurus had A$29.4 million in cash at the end of March.
