Transcription of The Stock Network Interview with Castile Resources (ASX:CST), Managing Director Mark Hepburn
Lel Smits: Castile Resources is developing the Rover 1 project in the Northern Territory, targeting gold production alongside downstream critical minerals, including copper, cobalt, bismuth and magnetite. With a successful pre-feasibility study completed in 2022, the company is now advancing a bankable feasibility study, or BFS, to deliver an initial eight-year mine life in a Tier 1 mining jurisdiction. I’m joined by Managing Director Mark Hepburn to discuss progress at Rover 1, critical mineral supply opportunities and also Castile’s pathway to securing strategic partners and financing.
Mark, welcome to the Stock Network.
Mark Hepburn: Thanks, it’s good to be here.
Lel Smits: Now, with the BFS underway following a successful PFS, what are the key milestones and technical considerations investors should be watching as you progress Rover 1 toward development and construction?
Mark Hepburn: The biggest thing for people to be looking for is the enormous increases that have occurred with the gold price and the copper price.
This is a gold and copper mine. It is 80 to 85 percent of the revenues, depending on what price you use on a daily basis. And we’ve seen gold going through the roof.
The price we used in our 2022 PFS was $2,600 Australian dollars. It’s now up around $5,800 Australian dollars. So if you times that by the 30,000 ounces that we’ll be producing every year, you’re already up around that sort of $170,000,000, $180,000,000 revenue just in gold.
Go across to the copper, we’ll be producing 7,000 tons of copper a year, copper is now $4.93 a pound, which translates to about $17,000 Australian dollars. Times that by the 7,000 tons that we’ll be producing every year, just in our two key metals, we’re up around that $300,000,000 in revenue, just on back of the envelope numbers. That’s before you add the critical minerals that we’re looking at here, and that is bismuth and cobalt.
In the Bankable Feasibility Study, we’ll be looking at how those two metals, the bonus byproducts, can actually do the bulk of the funding for this mine. Therefore, you’re underway producing your gold and your copper, which again are the two key metals on this mine, and you’re funding it with byproducts that you’re bringing to the surface anyway. It is a fantastic deposit, and it’s really showing now in this Bankable Feasibility Study.
Lel Smits: Brilliant. Now, Mark, you’ve highlighted the potential for strategic partners or off-take agreements to support the next stage of Rover One. What type of partnerships are you seeking? And also, how do you see this shaping the funding structure in terms of, and also the development timeline here?
Mark Hepburn: Well, that’s very important to the way we do things.
We’re looking for that partner that will be perfect for our deposit, not necessarily just someone that can provide finance. And we’re talking to those sorts of people as well, obviously. But a couple of the people we’re talking to actually produce, already produce the products that can be made from, and a great example is our bismuth.
You look at three or four months ago when the Chinese government banned the export of bismuth, and they produced 85% of it worldwide. All of a sudden, the price of bismuth goes from $6 a pound to $55 a pound, or in an equivalency, about $190,000 Australian per tonne. So we have now been approached by producers of bismuth who want to combine our bismuth with their bismuth.
And all of a sudden, you can approach a country such as the United States, who is now demanding and stockpiling critical minerals throughout the world. We can approach them as a combined entity with just the bismuth and do a prepayment on that bismuth. And you’re seeing that happen now with the stockpiling of cobalt, and certainly with China dominating bismuth production and distribution throughout the world.
People are looking for alternatives. We are one of the only companies in Australia with a bismuth resource. And so we are getting a lot of attention for that.
Considering we’re a gold copper mine, it’s a fantastic avenue for us to finance this mine.
Lel Smits: Mark, that is great to hear. Thank you so much for the update from Castile Resources and look forward to hearing more at the Mining Rockstars Investor event in Sydney later this month.
Mark Hepburn: Thank you. We are looking forward to the event.
Ends