Tenas Project’s Capital Costs Jump to US$139M, Yet NPV Climbs 45%

Updated Economics Amid Inflationary Pressures

Bathurst Resources Limited’s Canadian subsidiary, Telkwa Mining Limited, has unveiled the results of a 2025 Updated Feasibility Study for the Tenas Steelmaking Coal Project in British Columbia. This update revisits the 2019 Definitive Feasibility Study (DFS) by incorporating recent inflationary pressures on capital and operating costs, alongside revised coal price forecasts and foreign exchange rates.

The study reveals a notable increase in pre-production capital expenditure, rising from US$93 million to US$139 million, reflecting higher equipment prices, labour, fuel, and infrastructure costs. Operating costs have also escalated significantly, from US$52.58 per tonne to US$80.48 per tonne of saleable coal, driven by similar inflationary factors and additional environmental and socio-economic commitments.

Stronger Project Valuation Despite Cost Increases

Despite these cost escalations, the updated coal price forecasts; based on consensus data from respected market analysts; have improved sufficiently to enhance the project’s economic outlook. The post-tax Net Present Value at an 8% discount rate (NPV(8)) has risen from US$185 million in the 2019 DFS to US$269 million in the updated study. This uplift underscores the resilience of the Tenas Project’s economics amid a challenging cost environment.

Importantly, the Competent Person’s review has confirmed that the Proven and Probable Reserves defined in the original DFS remain valid, supporting the project’s technical and economic viability. The project maintains a 22-year mine life with a steady annual production of approximately 750,000 saleable tonnes of mid-volatile semi-soft coking coal, a product type that is scarce on the seaborne market and highly sought after by North Asian steel mills.

Strategic Location and Market Position

The Tenas Project benefits from an advantageous location in the Bulkley Valley, with access to existing rail infrastructure and the nearby Trigon Terminal at Prince Rupert. This port offers shorter shipping distances to key Asian markets such as Japan and South Korea compared to Australian competitors, and importantly, avoids the congestion issues that often delay shipments from Newcastle.

Market feedback from Japanese and South Korean steel producers has been positive, highlighting the scarcity of mid-volatile semi-soft coking coals and the value of diversifying supply sources beyond Australia. This positions Tenas uniquely in the global steelmaking coal landscape.

Regulatory Progress and Indigenous Partnerships

Telkwa Mining has made substantive progress in the British Columbia Environmental Assessment process, engaging closely with Indigenous Nations, including the Wet’suwet’en Peoples, to foster partnerships and address environmental and socio-economic concerns. The company is preparing to resubmit its Environmental Assessment Certificate application, aiming to advance toward permitting and construction.

Environmental management remains a key focus, with capital allocated for water management, acid rock drainage mitigation, and caribou habitat commitments. These measures reflect the high environmental standards expected in Canada and the company’s commitment to sustainable mining practices.

Looking Ahead – Financing and Optimization

Funding for the project’s capital requirements is anticipated to come from a mix of equity, debt, contractor arrangements, and pre-paid offtake agreements. While discussions with potential financiers are underway, the company cautions that equity issuance could dilute existing shareholders.

Telkwa Mining plans further optimization studies to refine the project economics and reduce capital intensity where possible, running in parallel with ongoing regulatory engagement. The updated feasibility study reinforces the Tenas Project as a compelling steelmaking coal development opportunity with robust fundamentals despite a complex cost environment.