The revised scoping study, updated after a year of additional work in Alaska, now starts off with a plant to be built at Caribou Dome copper deposit, which will kick off the mining operations with a circa 300m deep open pit.

 

The planned pit at Caribou Dome is now substantially larger, and removes the need for an underground option.

 

Processing starts at 750,000 tonnes per annum at Caribou Dome, followed by 600,000tpa at Zackly, some 35km away for the final few years.

 

While the start-up requires US$145 million in capital, PolarX believes it can achieve payback in around 2.8 years.

 

The study shows revenue of $1.37 billion and earnings of $573 million over the 9.5 year mine life. C1 cash costs are expected to be $1.93 per pound copper, with the precious metal credits.

 

Average annual free cashflow is expected to be $53 million.

 

PolarX calculates a pre-tax net present value of $201 million with an internal rate of return of 38%.

 

The project is most sensitive to the copper price, and even a modest increase in production or grade can deliver improvements in profitability. For example, a 7% increase in copper recovery could boost NPV by $174 million.

 

The company will continue to drill out the deposits, with resource extensions likely to improve the economics or mine life as both deposits are open in multiple directions.

 

The mineralisation is known to continue 150m below the 7.2Mt at 3.1% copper and 6.5 grams per tonne silver Caribou Dome resource and could support a future underground operation. 

 

PolarX recently upgraded the Caribou Dome resource, but Zackly remains unchanged since a 4Mt at 1.1% copper, 1.6gpt gold and 12.6gpt silver resource was announced in 2022. 

 

Total contained metal is 269,000t of copper, 213,000 ounces gold and 3.1Moz silver.

 

The company owns 100% of Zackly and has until June 2024 to move to 100% of Caribou Dam by paying a further $1.26 million in option payments, and either completing a feasibility study or spending a further $160,000.

 

The junior has been involved in the project for almost a decade.

 

It had just A$730,000 cash last quarter, but raised $1.55 million at 1.1c via a placement, and is seeking up to $2.74 million on the same terms through a non-renounceable pro rata offer.

 

PolarX shares were last traded at 1c, capitalising the company at $15 million.