Sunkar Resources shares rocket on feasibility study

Shares in mining group Sunkar Resources leapt almost 180 per cent on Thursday after a feasibility study on its Chilisai Phosphate Project estimated an internal rate of return of 17.2 per cent before tax.

Shares in mining group Sunkar Resources leapt almost 180 per cent on Thursday after a feasibility study on its Chilisai Phosphate Project estimated an internal rate of return of 17.2 per cent before tax.

Discounted at 10%, the net prsent value of the project is estimated to be $715.2m, with estimated earnings before interest, tax, depreciation and amortisation (EBITDA) of $278m per annum in 2017 and $533m by 2025.

The study predicted that the total construction cost for both phases of the project will be $1.94bn.

The nominal cash cost of di-ammonium phosphate (DAP) production is estimated at $195 per metric tonne at 2017 and $232 in 2025, while for mono-ammonium phosphate the cost is expected to be $171 in 2017 and $219 by 2025.

Serik Utegen, Chief Executive of Sunkar, said: "The study outlines robust economics for this major project with attractive IRRs [internal rates of return], drawing on Chilisai's natural advantages of low cost mining, proximity to sulphur and well established regional infrastructure, as well as attainable markets both locally in Kazakhstan and internationally to Western China and through Black Sea ports.

"The study has identified no major technical hurdles with the Chilisai Project and we currently anticipate announcing the award of the basic engineering contract in the second half of this year, leading to stage I production by the last quarter of 2016."

The share price had rocketed 178.79% to 11.50p by 15:05 Thursday.

NR

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Most Popular

Forget austerity – governments and central banks have no intention of cutting back
Global Economy

Forget austerity – governments and central banks have no intention of cutting back

Once the pandemic is over will we return to an era of austerity to pay for all the stimulus? Not likely, says John Stepek. The money will continue to …
15 Jan 2021
The MoneyWeek Podcast: bitcoin special
Bitcoin

The MoneyWeek Podcast: bitcoin special

Merryn talks to bitcoin experts Dominic Frisby and Charlie Morris to get the lowdown on the cryptocurrency to find out why it's such a huge global phe…
15 Jan 2021
A simple way to profit from the next big trend change in the markets
Investment strategy

A simple way to profit from the next big trend change in the markets

Change is coming to the markets as the tech-stock bull market of the 2010s is replaced by a new cycle of rising commodity prices. John Stepek explains…
14 Jan 2021
Free 6 issue trial then continue to