TSX-listed Moneta Porcupine has announced the results from a preliminary economic assessment (PEA) on the South West deposit, at its Golden Highway project in Timmins, Ontario.
The PEA is based on a standalone, owner-operated mine and mill with an 11-year mine life, producing 75 700 oz/y at a cash cost of $590/oz.
Initial capital costs have been estimated at C$144-million and sustaining capital costs at C$136-million.
Using a $1 500/oz gold price, the study calculated an after-tax net present value (NPV) of C$236-million, using a 5% discount rate, and an internal rate of return (IRR) of 30% with a capital payback of 3.4 years.
At a gold price of $1 900/oz, the NPV nearly doubles to C$423-million and a 47% IRR.
“The excellent economics are afforded by the project’s location in Canada’s most prolific gold mining camp, Timmins, Ontario, with extensive existing infrastructure and experienced and available services and workforce,” said CEO Gary O’Connor.
In addition to the base development plan, Montena Porcupine said it also had a highly attractive development option which involved minor initial capital expenditure, shorter development time line and negated the need to permit and build a processing plant and associated infrastructure, assuming toll milling of the ore.
The toll milling option has an NPV of $197-million and IRR of 44, with an initial capital cost of C$65-million.
In addition to the South West deposit, the company has five additional gold deposits on the Golden Highway project and has discovered three new mineralised areas – Westaway, Halfway and South Basin in 2020. A maiden resource for Westaway is planned for this year.