Find the net present value (NPV) of a mining project with the following cash flows:
- -$3,000 at time zero (t=0). This is the initial cost to prepare and build the mine and facilities. This cost is all paid upfront, though the builders will take 4 years to finish construction.
- $650 paid annually 45 times, where the first payment is made 5 years from now. So there are 45 annual payments from t=5 to t=49 inclusive. These are the positive cash flows from running the mine once it's built.
- -$1,400 at t=49. This is the clean-up cost of burying the mine and replanting native vegetation at the end of the project. This cost is paid at the same time as the last positive cash flow is received from running the mine.
The required return is 15% pa. All dollar figures above and below are in millions. The NPV of this project is: