Develop exploring Woodlawn funding as pre-tax NPV soars

Develop (ASX:DVP) has completed the Woodlawn Copper-Zinc Mine production restart study in which the pre-tax NPV has jumped 37% to $658 million from the previous September 2023 estimate.

The ore reserve has increased by 80% to 6Mt at 2.8% copper-equivalent and the mineral resource has grown 55% to 11.3Mt at 3.8% CuEq.

Woodlawn’s pre-tax free cashflow increased 60% from $626 million to $1 billion based on a 10-year mine plan.

Assumed prices in the first 18 months of production are US$8,769 per tonne copper and US$2,688/t zinc.

Develop Managing Director Bill Beament says the restart plan confirms that Woodlawn is a great mine by any measure.

“The valuation, the inventory, the cashflow and the returns are all extremely strong. At the same time, the start-up costs, the funding requirements and the risks are all very low.

This exceptional scenario sits against a backdrop of a very bullish outlook for copper and zinc, particularly in tier one locations. In light of this enviable position, Develop has commenced exploring several funding options. These include potentially selling a minority interest in Woodlawn to a strategic investor, traditional project finance and offtake financing.

The sale of a minority interest would enable us to recycle some capital and may provide us with a model which we can apply to our Sulphur Springs mine at the appropriate time. We have already received an elevated level of interest in Woodlawn from potential financiers, strategic partners and customers and we will now test this appetite more thoroughly.

Completion of this milestone, which will be our major focus this quarter, will put us in the home straight for a production restart.”

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Written By Adam Orlando Editor-in-Chief Adam Orlando has more than 20 years’ experience in the media having held senior roles at various publications, including as Asia-Pacific Sector Head (Mining) at global newswire Acuris (formerly Mergermarket). Orlando has worked in newsrooms around the world including Hong Kong, Singapore, London, and Sydney.