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Canadian gold proves up for Matador

6th May 2020

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

     

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PERTH (miningweekly.com) – A scoping study into the Cape Ray gold project, in Canada, has found that the project could produce some 504 000 oz of gold over a seven-year mine life.

ASX-listed Matador Mining on Wednesday told shareholders that the scoping study estimated an initial capital cost of $102-million to development the project, with a processing facility throughput of 1.2-million tonnes a year, with an average head grade of 2 g/t gold and 2.56 g/t gold over the first four years of operation.

Over the first four years of its mine life, Cape Ray is expected to produce 88 000 oz/y of gold, with the scoping study also estimating a total life-of-mine silver production of 863 000 oz, or 124 000 oz/y.

The study estimated a net present value of A$194-million, based on a gold price of $1 550/oz, and an internal rate of return of 51%.

“The results of the scoping study were an excellent achievement for the company and exceeded our expectations in may regards,” said Matador executive director Keith Bowes.

“The most important outputs we believe for any resource project is a strong internal rate of return, rapid payback as well as low operating costs. With excellent outcomes in each of these areas, which strengthen further when the current spot price is applied, we believe the Cape Ray project is well on track to become a gold operation in the future.

“The key drive for these robust returns is the exceptional high-grade openpit ore that is mined and processed during the first two years and first four years of production, meaning the Cape Ray project ranks as one of the highest grade openpit operations.”

Bowes said that following the feasibility study, the Matador board has now approved the start of a prefeasibility study, with a number of areas identified that could potentially improve the project economics.

“While the scoping study has provided a strong underlying platform, we believe the exploration potential at Cape Ray remains the long-term driver for the company. With 80 km of strike, making the company the largest continuous land holder in this underexplored gold region, the company is close to finalising an exploration strategy that will outline the pathway towards increasing the mine life.”

Edited by Creamer Media Reporter

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