PERTH (miningweekly.com) – ASX-listed Theta Gold Mines has estimated that its TGME underground gold mine, in South Africa, would require a A$232-million investment to bring the project into production.

Phase 1 of the definitive feasibility study (DFS) into the TGME operation was based on the initial development of four mines, and has estimated an initial life-of-mine (LoM) plan of nearly 13 years, at a processing rate of 540 000 t/y.

Theta said on Thursday that first gold production is targeted for the second quarter of 2024, with the plant expected to produce over 100 000 oz/y by the third year of production. Over the LoM, Theta could recover as much as 1.08-million ounces of gold from the 1.24-million ounces mined.

Based on a gold price of $1 642/oz, the DFS estimated a post-tax net present value of A$292-million for the TGME project and an internal rate of return of 57%, with the project’s post-tax free cash flow projected at A$678-million.

“The completion of the DFS marks a significant milestone achievement for Theta Gold shareholders, and brings with it the rebirth of one of South Africa’s historical mine projects, offering significant opportunities for our employees and their families as well as the local communities within the region,” said Theta Gold chairperson Bill Guy.

“The DFS has confirmed the mining method, technical aspects, and the economic viability of the 540 000 t/y mining and processing operation. The standalone carbon-in-leach plant is to be constructed in modules using technology that enhances the design efficiency and construction of the metallurgical plant, with the optionality to expand production capacity in the future as additional mines are brought into production.”

Guy said that the DFS used a base gold price of $1 642/oz with an all-in sustaining cost of $834/oz, thus displaying the financial robustness of the project which delivers a capital pay-back of $99-million, in 31 months.

“Once up to seven mines are brought into production, including Vaalhoek, Desire and Glynn’s Mines, an annual production of 160 000 oz/y will make Theta one of South Africa’s most significant, midtier listed gold doré producing companies,” Guy said.