Wildcat’s PFS elicits lacklustre response

Wildcat has issued a PFS for its Tabba Tabba project, but the market hasn’t liked it – shares were down -8.3% at lunchtime. Some HotCopper users were concerned Wildcat has relied on assumed lithium prices well above what other majors like Pilbara Minerals (ASX:PLS) are currently seeing.

The PFS highlights free cashflow of $4.57 billion pre-tax with an NPV of $1.74 billion and an IRR of 26.6%. Capex for stage 1 is $443 million, while stage one and two pre-strip costs are $144 million. 

Tabba Tabba has an initial 17-year mine life and a maiden ore reserve of 46.3 million tonnes @ 0.99% lithium oxide.

Stage two is expected to expand to 4.5 million tonnes per year operation via open-pit as well as underground operation, contributing production ore from the sixth year, all cards in order.

Despite the share price action in the Tuesday session, General Manager of Project Development James Dornan says the PFS highlights a project with strong fundamentals.

“The flexibility of the project to scale up or down in a changing lithium environment is of particular note,” Dornan said. 

“Completion of the PFS is a significant milestone in the development of the Tabba Tabba Project. It provides a solid foundation on which to progress through to a Definitive Feasibility Study.”

Still, on the HotCopper forum, some users have questioned the viability of the project given the depressed state of lithium prices.

Wildcat is currently conducting a comprehensive financing review to seek funding of the project. Funding arrangements are yet to be finalised, however, the company says it is confident in its ability to secure the necessary financing at each stage of the project.

Wildcat is also exploring joint venture partnerships and offtake agreements as potential funding mechanisms. The company expects to secure a combination of debt, equity, joint ventures, or offtake arrangements as key development milestones are achieved. 

WC8 last traded at 16.5cps.

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