Prophecy Development’s Oosterman on becoming a major global supplier for vanadium
“We recently did a preliminary economic assessment on our Gibellini Project in Nevada, U.S.A and we had some key findings. Basically some of the numbers projecting over 13.5 year mine life. We anticipate an internal rate of return of 50.8%, a net present value of $338 million. This is using a base case price for vanadium of $12.73.” States Danniel Oosterman, Vice President of Exploration at Prophecy Development Corp. (TSX: PCY | OTCQX: PRPCF), in an interview with InvestorIntel Corp. CEO Tracy Weslosky.
Tracy Weslosky: You have had so much news recently, but I think one of the most significant pieces of news is your PEA results. Can you talk to us about that?
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Danniel Oosterman: Absolutely. We recently did a preliminary economic assessment on our Gibellini Project in Nevada, U.S.A and we had some key findings. Basically some of the numbers projecting over 13.5 year mine life. We anticipate an internal rate of return of 50.8%, a net present value of $338 million. This is using a base case price for vanadium of $12.73. Today’s price of vanadium is $14.10. If you were to use today’s price for vanadium the internal rate of return actually goes up to 57% and the net present value goes up to $415 million. Keep in mind that our capex or capital expenditure to move the mine into production is only $117 million dollars. That is one-third of the NPV. There are not a lot of projects out there that can boast these sorts of numbers.
Tracy Weslosky: When I look at your market cap and I look at what you are supplying and all of the present geopolitical issues at the forefront, I would think that many smart investors that are interested in sustainability would be looking at Prophecy.
Danniel Oosterman: Exactly. There are no primary vanadium producing mines in North America currently. We are the only project, not only in North America, but really in the world, that has a near-term production timeline. We are looking at production hopefully within 3 years. We already submitted our Plan of Operation to the Bureau of Land Management in the United States. This basically over time kicks off for us the permitting schedule for us. We anticipate to get 38 permits over the next 2 years. We are also submitting our Engineering Procurement and Construction Management, which is basically going to cost the entire project with a contract mining outfit over the next year.
Tracy Weslosky: I think you told me previously that 99% of all the vanadium is imported in the United States. When you are actually producing you will then be providing 3½% of the world’s supply. Did I read that correct?
Danniel Oosterman: That is correct. If you were to take out China as a player we would actually produce 15% of the world’s supply. That makes us a major supplier. We will be producing 9.7 million pounds of vanadium annually with this project…to access the complete interview, click here
Disclaimer: Prophecy Development Corp. is an advertorial member of InvestorIntel Corp.
Raj Shah has professional experience working for over a half a dozen years at financial firms such as Merrill Lynch and First Allied Securities Inc., ... <Read more about Raj Shah>