KALGOORLIE (miningweekly.com) – The low-cost Haile gold project, in South Carolina, would weather a low commodity price environment, dual-listed gold miner OceanaGold said on Wednesday.
Speaking on the sidelines of the Diggers & Dealers conference, OceanaGold MD and CEO Mick Wilkes noted that the Haile project had the basic fundamentals for a low-cost operation, including low labour costs, low power costs and existing infrastructure.
“Our due diligence focused on stress testing this theory and the value of the project holds up very well even at low gold prices,” he said.
The Haile asset was being acquired as part of a takeover of Canadian project developer Romarco Gold. The all-scrip offer, announced in July, was valued at C$856-million and was expected to create the lowest-cost gold producer in the market.
Haile was expected to produce about 540 000 oz/y from 2017 at an all-in sustaining cost (AISC) of less than $600/oz. During the mine’s first year of operations, the AISC was expected to be as low at $414/oz of gold.
Wilkes said the project also offered significant upside potential with a possible underground operation offering further value creation.