CHN has released an updated high-grade resource estimate for the Gonneville deposit at its Julimar project. The resource is designed to underpin a smaller scale development of the project, while preserving the optionality of the large world class resource. We have adjusted our base case development scenario to match the new resource, with the lower grades compared to our previous mining inventory assumption offset by higher recovery rates and an increase in throughput rate from 3.5mtpa to 4.0mtpa. Importantly, our development scenario generates an IRR of 21% using Argonaut commodity price forecasts and 16% at current spot prices. Advancing the scoping study on the smaller scale starter project presents a key catalyst for CHN and we reiterate our SPEC BUY rating and A$2.40 price target.
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