PERTH (miningweekly.com) – A prefeasibility study (PFS) into the Misima gold project, in Papua New Guinea, has confirmed the potential of a long-life, low cost gold mine.

ASX-listed Kingston Mining on Tuesday revealed that the project would produce some 130 000 oz/y over a mine life of 17 years, based on a mining rate of 5.5-million tonnes a year.

The PFS is based on the redevelopment of the brownfield site of the former Misima gold mine, which produced 230 000 oz/y over a 15-year mine life.

Kingston has estimated that the project would require a capital investment of A$283-million to deliver, with the pre-tax net present value estimated at A$822-million and the internal rate of return estimated at 33%, with a pay-back period of 4.7 years.

The PFS has estimated life-of-mine revenues of A$4.9-billion and free cash flows of A$1.5-billion, with all-in sustaining costs estimated at an average of A$1 159/oz.

Along with the PFS results, Kingston on Tuesday also reported a maiden Joint Ore Reserves Committee-compliant reserve of 48.3-million tonnes, grading 0.9 g/t gold for 1.35-million ounces at Misima, which the company said would underpin a large scale, long life project, while the global resource at the project has also increased by 12.5%, to 144-million tonnes grading 0.79 g/t gold for 3.6-million ounces.

“This is a significant milestone for all stakeholders in the Misima gold project, and represents a meaningful step towards our goal of becoming a substantial new midtier Asia Pacific gold producer,” Kingston MD Andrew Corbett said about the release of the PFS.

“These are outstanding results that highlight Misima as one of the best undeveloped projects in the Asia Pacific region. It is also a platform from which we will continue to unlock further value through the targeted drilling campaign currently under way at Misima. We are now planning a number of additional work programmes which will feed into the definitive feasibility study, which is anticipated to commence in the second quarter of 2021,” said Corbett.