Antilles' Cuban gold dreams viable
PERTH (miningweekly.com) – A scoping study into the La Demajagua openpit gold mine, in Cuba, has estimated that the project would require a capital investment of $75-million, and could produce 100 600 oz/y of gold equivalent over a six-year mine life.
The mine will be developed in a 49:51 joint venture (JV) between ASX-listed Antilles Gold and the Cuban government’s mining company GeoMinera SA, with the aim of producing a bulk gold/silver concentrate.
The scoping study estimated that the project would generate life-of-mine sales revenue of $700.5-million, and life-of-mine profits after tax of $312.4-million.
Antille’s equity contribution to the project is expected to amount to A$18-million, with its share of average annual profits reaching A$35-million.
The scoping study estimated a net present value of $218.1-million for the project and an internal rate of return of 43.7%.
Antilles executive chairperson Brian Johnson said on Thursday that the results of the scoping study were encouraging and demonstrated the excellent returns that Antilles could expect to receive on its relatively low equity contribution to the project.
“The returns from the La Demajagua project will increase with cash flow from the underground operation planned to follow the openpit mining for approximately ten years. The results also indicate that the JV company’s first project could become the catalyst for realisation of its aim of developing a series of mines in order to progressively establish itself as a substantial mining company in Cuba.”
The JV will apply part of the surplus cash generated at La Demajagua to fund future developments.
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