The Queensland Pacific Metals Ltd (ASX: QPM) share price has taken another tumble on Tuesday.
At the time of writing, the energy chemicals developer's shares are down 8% to 11.5 cents.
This means the Queensland Pacific Metals share price is now down 34% in the space of two days.
Why is the Queensland Pacific Metals share price crashing this week?
Investors have been hitting the sell button this week after the company released the results of the advanced feasibility study on stage 1 of the Townsville Energy Chemicals Hub (TECH) project.
Investors appear alarmed at the capital expenditure estimate for stage one of $1.9 billion plus contingency allowance. This compares to the 2020 pre-feasibility study (PFS) estimate of $650 million.
Though, it is worth noting that the plant scale has increased 2.7x since the PFS and global equipment costs have increased over the past two years.
Nevertheless, the big question is how will the company fund this massive cost? With a market capitalisation now under $200 million, Queensland Pacific Metals needs to raise 10x its market cap in debt or equity to get the project up and running.
Though, with a base case stage one annual EBITDA estimate of $546 million and a pre-tax IRR of 18.4%, there might be some takers.
The company also has a conditional commitment of $250 million from Export Finance Australia and interest from other export credit agencies and commercial banks.
Time will tell what happens, but the existing shareholders that have stuck around might need to brace for some major share dilution in the coming months.