A preliminary economic assessment (PEA), undertaken by consultants SRK Consulting, has shown a positive net present value (NPV) of $285-million for TSX-V- and Frankfurt-listed Giyani Metals' K.Hill manganese project, in Botswana.
Giyani will have to invest about $141.3-million in capital expenditure on the project, which is expected to produce about 245 000 t of high-purity electrolytic manganese metal (HPEMM) over a nine-year operating life.
The PEA was based on a sales price of $4 700/t for a 99.9% HPEMM product.
The after-tax internal rate of return is estimated at 90.6%.
“We are extremely pleased with the completion of the PEA for K.Hill, our first deposit in Botswana, and we are even more delighted with the findings of this report, which demonstrates the strong economic potential of the K.Hill manganese project.
"Our immediate next steps are to continue hydrometallurgical testing with electrorefining to produce HPEMM samples for testing by battery makers. We will move forward with a definitive feasibility study to upgrade K.Hill into a mineral reserve through a targeted reserve drilling campaign and, ultimately, develop a mine plan for the K.Hill project,” Giyani CEO Robin Birchall commented on Thursday.
The company noted that the initial attractive project economics and the growing market demand for battery-grade manganese products should attract multiple offers of project financing from the mining investment community.
Giyani plans to apply for a mine permit for K.Hill in 2020.