NioCorp’s Elk Creek niobium project valued at $3.4B 

An updated feasibility study increases the net present value of NioCorp Developments (Nasdaq: NB) Elk Creek project in Nebraska by 46% after the company more than doubled its product range beyond niobium, titanium and scandium. 

The study outlines the project’s evolution into a 40-year, integrated U.S. operation with an after-tax NPV at an 8% discount rate of $3.44 billion compared with $2.35 billion in a 2022 study, NioCorp said Tuesday. The project is expected to produce eight critical-mineral products from a single ore body, it added.  

Initial capital costs rise 62% from $1.14 billion to $1.85 billion, reflecting inflation since 2022 and a substantially redesigned mine and processing plant that will produce eight products instead of three. The trade-off is that the expanded flowsheet adds separated rare earth products alongside niobium, scandium and titanium, boosting life-of-mine revenue by 72% to $37.4 billion and average annual earnings before interest, taxes, depreciation and amortization by 51% to $608 million.

The project has an after-tax internal rate of return of 23% compared with 26% four years ago, while average annual cash flow increases 54% to $519 million. 

Project shift

While the redesigned operation requires substantially more upfront capital and delivers a lower rate of return, it is expected to generate stronger long-term cash flow and value by expanding into a broader suite of critical minerals, extending mine life and producing separated rare earth products alongside niobium, scandium and titanium.

NioCorp’s stock closed 1.6% weaker at $5.36 apiece on Tuesday on the Nasdaq. It was at $5.38 on Wednesday morning for a $782-million market capitalization.  

The Elk Creek project is expected to produce eight products, all designated by the U.S. Government as critical minerals. The rare earth products are neodymium-praseodymium oxide, dysprosium oxide and terbium oxide, samarium-europium-gadolinium carbonate, and heavy rare earth carbonate. The project is also to produce ferroniobium, scandium trioxide, and titanium tetrachloride.   

Permits 

This expanded product suite positions the Elk Creek Project to serve multiple U.S. critical-mineral and defence supply chains from an integrated mine and processing facility that has secured  its major construction-related permits, NioCorp said.  

“Our 2026 feasibility study transforms the Elk Creek project into the kind of  critical minerals project the United States needs to have online as soon as  possible,” NioCorp CEO Mark A. Smith said in a release. 

“Few critical minerals projects in the U.S. can match the Elk Creek Project’s combination of a 40-year mine life, all major construction-related permits already in hand, and the planned production of eight critical mineral products from a single ore body.”