Column: Trump 2.0 won’t reverse Biden’s critical minerals push
Donald Trump has described the Inflation Reduction Act (IRA) as a "green scam" and vowed to repeal it after he returns to the White House in January.
Centerra Gold (TSX: CG; NYSE: CGAU) has updated plans for each of its business units, most importantly for the restart of the Thompson Creek molybdenum mine 48 km southwest of Challis, Idaho. The pit and concentrator were put on care-and-maintenance in 2014, when ore from phase seven mining was depleted.
The company has completed a prefeasibility study (PFS) for reopening the Thompson Creek operations. It gives a restarted project – along with the Langeloth tolling facility near Pittsburgh, Penn. – a combined $373 million after-tax net present value at a 5% discount and a 16% after-tax internal rate of return.
The study calls for increasing capacity utilization at Langeloth (one of the largest molybdenum conversion plants in North America). The extra capacity will allow Centerra to blend high grade Thompson Creek ore with lower-quality third-party concentrates. That will increase the volume of high margin final molybdenum products.
The mining plan for Thompson Creek has a life of 11 years, producing a lifetime 134 million lb. of molybdenum (moly). The average mill head grade will be 0.07% moly. The all-in sustaining cost of a pound of moly will range from $15 to $18 in years two and three, to $12 to $15 in years four to eight, and $8 to $11 in years nine through 11.
According to the PFS, Centerra will have to spend between $350 million and $400 million to satisfy pre-production capital requirements. The capital spending at the project in 2023 is expected to be $9 million to $10 million to advance the project with de-risking activities such as geotechnical drilling, additional engineering costs, and onsite early works.
Centerra has begun a feasibility study at Thompson Creek which is expected to be complete in mid-2024. The company then plans to authorize a limited notice to proceed with $100 million to $200 million of pre-stripping and long-lead times equipment purchases.
The Thompson Creek project has measured and indicated resources of 117.1 million tonnes grading 0.07% moly and containing 177 million lb. of metal. The inferred resource is 806,000 tonnes grading 0.04% moly and containing 1 million lb. of molybdenum.
