Osmond’s Orión Study Shows Strong Economics for Spanish Critical Minerals Project

Orión Study Delivers Large Preliminary Returns

Osmond Resources Limited (ASX:OSM) has produced an eye-catching set of numbers for its Orión EU Critical Minerals Project in southern Spain: a post-tax, unlevered NPV8 of US$2.309 billion, a 145% IRR and average annual EBITDA of US$531 million. Those figures are modelled on a 100% project basis, while Osmond’s beneficial interest is 76%, following completion of the scoping study.

The proposed operation is a 2Mtpa underground room-and-pillar mine feeding a processing plant that would produce about 42,300 tonnes a year of monazite concentrate, 68,000 tonnes of zircon concentrate and 109,000 tonnes of mixed titanium concentrate over an initial nine-year mine life. The estimated initial capital cost is US$299 million, including a 25% contingency, with sustaining capital of US$6 million a year.

Strong Economics Come With Early-Stage Qualifications

The study’s most striking claim is a modelled life-of-mine C1 cash cost of negative US$12.67 per tonne of run-of-mine material after zircon and titanium by-product credits. That is not a forecast of realised rare earth production costs: it depends on assumed recoveries, product payability and prices for three separate concentrate streams, all of which remain subject to further testing and customer qualification.

Osmond describes the study as a preliminary technical and economic assessment with an accuracy range typically around plus or minus 35%. It is not sufficient to support an Ore Reserve, and no Ore Reserve has been declared. The production target processes 15.8 million tonnes from the high-grade Main Seam, comprising 10% Measured, 61% Indicated and 29% Inferred Mineral Resources. The company says the Inferred component is not a determining factor in the modelled viability, pointing to a separate seven-year Measured and Indicated scenario with a post-tax NPV8 of US$1.706 billion and an IRR of 137%.

Funding Is the Immediate Constraint

The arithmetic is more compelling than the balance sheet. Osmond estimates that commercial-scale development would require pre-production funding of about US$300 million, and states that it is not currently funded for the estimated development cost. The company may pursue equity, debt, offtake prepayments, strategic investment or a joint venture, but no funding arrangements have been put in place. Any equity financing could dilute existing shareholders, while a project-level transaction could reduce Osmond’s proportionate ownership.

The project’s strategic pitch is clear. Module 1 is modelled to produce annual output equivalent to roughly 6% of forecast 2030 European Union NdPr demand, 24% of zirconium demand and 8% of titanium feedstock demand. Osmond intends to seek EU Strategic Project status and Spanish and Andalusian support, while its proposed underground design and planned use of filtered tailings as backfill are intended to limit surface disturbance. Those policy and engineering advantages may help the funding case, but neither designation nor financial support has been secured.

Drilling and Metallurgy Set the Next Milestones

Osmond plans to begin a 13-hole drilling campaign shortly to increase resource confidence and scale, then update the Mineral Resource Estimate and scoping study. Pre-feasibility-level metallurgical work is already under way, targeting premium-grade zircon, a near-pure rutile stream and an upgraded monazite concentrate. The current flowsheet still relies on assumptions where testwork is incomplete, including aspects of titanium recovery, flotation repeatability and concentrate dewatering.

The company is targeting an exploitation concession application in the first half of calendar 2027 and first production in 2030. Between now and then, the critical question is not whether Orión’s spreadsheet can produce a spectacular return. It is whether the next resource, metallurgy and financing work can narrow the study’s wide uncertainty band without eroding the ownership and economics that make the project attractive.