Coosa Graphite Project PEA: $190M NPV, 24.2% IRR
Westwater Resources Inc.'s Coosa Graphite Project in Coosa County, Alabama, USA has a Preliminary Economic Assessment (PEA) outlining an after-tax NPV of $190M, an after-tax IRR of 24.2%, and initial capital of $152M. The mine plan runs 22 years at about 103000 stpa Cg concentrate per year.
Westwater Resources Inc.'s Coosa Graphite Project has reported Preliminary Economic Assessment (PEA) results for the graphite project in Coosa County, Alabama, USA. The study headlines an after-tax net present value of $190M at a 8% discount rate. It reflects Westwater Resources Inc.'s (WWR) latest disclosed economics for the asset.
Economics. The after-tax NPV is $190M using a 8% discount rate. After-tax IRR is 24.2%. Initial capital expenditure is estimated at $152M, with life-of-mine sustaining capital of $142M. Economics are based on US$998/st ($1,100/tonne) Cg concentrate (CIF Kellyton Plant); Mineral Resource pit shell uses US$1,100/st; marginal cut-off grade based on US$806/st (revenue factor 0.8).
Production and mine plan. The project envisions an open-pit operation. Life of mine is 22 years. Average annual production is approximately 103000 stpa Cg concentrate. Average head grade is 3.21% Cg. Metallurgical recovery averages 92%. The open-pit strip ratio is 0.21:1.
Resources and ownership. The company holds a 100% interest in the project. Royalties and streams: Merchant 0.5% NSR up to a maximum of $150,000; Lessor 2% NSR; Coosa County Severance Tax $5/st concentrate.
These figures are extracted from Westwater Resources Inc.'s technical disclosures and reflect the most recent PEA on file. Compare this project against other developers and producers in our project economics database, and always verify the numbers against the original technical report before making any investment decision.
Reserves & Resources
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Indicated | 26 Mst | 2.89% Cg | 1,509 Mlb Cg / 754,000 st Cg |
| Inferred | 97 Mst | 3.08% Cg | 5,996 Mlb Cg / 2,998,000 st Cg |
Our Analysis
- IRR after-tax
- 24.2%
higher than 27% of 15 projects we track
- NPV after-tax
- $190M
higher than 20% of 15 projects we track
- Initial capex
- $152M
80% of NPV
costlier than 41% of 17 projects we track
- Mine life
- 22yrs
- Discount rate
- 8%
- Study price assumption
- US$998/st ($1,100/tonne) Cg concentrate (CIF Kellyton Plant); Mineral Resource pit shell uses US$1,100/st; marginal cut-off grade based on US$806/st (revenue factor 0.8)
The number that decides this project is not the 24.2% after-tax IRR. It is the $152M initial capex against a US$59M market cap: the build costs roughly 2.6 times what the entire company is worth. A micro-cap cannot write that cheque from its own balance sheet, so the realistic paths are a heavily dilutive equity raise, a partner or offtaker carrying construction, debt against a PEA-stage asset (unlikely on its own), or some combination. Each path costs existing holders something, whether in ownership or in economics surrendered. That is the trade an investor is actually underwriting, and it sits upstream of every line in the study.
The economics are adequate rather than exceptional, and the peer tables say so. The after-tax NPV of $190M ranks above only 20% of the 15 graphite projects we track; the IRR ranks above 27%. Against the practical hurdle, a developer of this profile with little else in the portfolio typically needs 20%+ after-tax to attract project finance, and 24.2% clears that with limited margin. The 8% discount rate is a reporting convention, not a hurdle, and carries no signal. Capex at 80% of NPV is moderately capital-intensive, though lower than 59% of the projects we track, so the burden is the company's size rather than the asset's design.
Two further cautions. This is a scoping-level PEA, which may rest on inferred material and carries a capital estimate with a plus or minus 50% band, so the $152M could move materially before a feasibility study fixes it. The returns also depend on the study's own US$998/st concentrate assumption, and the sensitivity of the NPV and IRR to that input is the main economic swing factor an investor should test. The question that settles this: can management fund a $152M build without handing away the project's value to whoever signs the cheque?
Our take, benchmarked against the project economics in the Mining Stocks database. Figures are estimates drawn from company technical reports — not investment advice; always verify against the source filing.
Get the next one first
Be the first to know about new mining results, and how they compare to other projects.