King River Copper says its flagship vanadium-titanium project is going to cost $2-2.5 billion to build — and investors hate that.

The explorer (ASX:KRC) released an underwhelming baseline study for its Speewah vanadium-titanium-iron project in Western Australia.

Eight pages into the study, the explorer admitted that initial up-front capital costs would be in the billions.

In comparison, Australian Vanadium (ASX:AVL) and Technology Metals (ASX:TMT) have estimated start-up capital costs of about $500 million and $380 million for their respective vanadium projects.

These project are also more advanced, which has given AVL and TMT opportunities to bring these costs down.

The King River share price plunged more than 35 per cent to 3.6c before midday.

Its share price has traded between 0.7c and 19c over the past year.

Depending on the production volumes at Speewah, King River estimates a payback period of between three and six years.

The King River scoping study mentions “healthy cashflow margin[s]” but does not offer any revenue projections.

“The results of the study are being used for internal project decision making by [King River] and the board are sufficiently encouraged by the financial returns of the long-life project to continue to the next stage of development,” King River told investors.

It said improvements to the business case could be made by “reducing capital costs, enhancing project efficiency through various processing methods being trialled, production of additional higher value, higher purity products, and incorporating the recent improvements in the V2O5 sale price”.

The company will be primarily focused in coming months on further investigating processing options for the project and will start a Pre-Feasibility Study (PFS) early in 2019 after this analysis is completed.

Miners undertake up to four different types of studies to determine whether or not a resource can be mined economically. These are scoping, preliminary feasibility (PFS), definitive feasibility (DFS) and bankable feasibility (BFS).

This PFS will be completed to a standard that will allow reporting an ore reserve and a much more detailed economic analysis, King River told investors.