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Ausenco on board for Grassy Mountain feasibility study

25th June 2019

By: Creamer Media Reporter

     

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Engineering, construction and project management firm Ausenco has agreed to complete a feasibility study for US-based Paramount Gold Nevada’s proposed Grassy Mountain gold mine, in exchange for shares in the NYSE American-listed company.

Ausenco, together with several other consulting groups, completed the prefeasibility study (PFS) on Grassy Mountain, in eastern Oregon, last year.

In lieu of cash compensation, Ausenco will receive its fees in restricted common stock of Paramount, resulting in the issuance of 1 109 225 shares to Ausenco. The shares will be escrowed until the final feasibility study is delivered.

Ausenco, along with Golder Associates and Mine Development Associates, will initiate the feasibility study next month, with completion expected in mid-2020.

Paramount said it should have all permits in place next year, and that it was preparing to initiate construction immediately following receiving all permits.

As evaluated and positively tested in the PFS, the feasibility study will focus on a 750 t/d mill followed by a gravity concentration and subsequent carbon-in-leach process in a closed and confined circuit. The ore will be extracted using a drift and fill underground mining method and trucked to surface.

“We are thrilled to have Ausenco, a globally recognised industry leader in engineering, project development and construction, as a partner to advance our high-grade Grassy Mountain gold project through feasibility, construction and ultimately production,” said CEO Gen Van Treek.

The 2018 PFS outlined a robust case for the proposed Grassy Mountain project, with the base case projecting an after-tax internal rate of return of 28% at $1 300/oz of gold and the estimated net present value exceeding $87-million at a 5% discount rate.

The mine will produce about 47 000 oz of gold and 50 000 oz of silver for 7.25 years.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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