PERTH (miningweekly.com) – Dual listed gold miner OceanaGold has released a feasibility study on its Martha Underground operation, at the Waihi project in New Zealand, outlining an initial reserve for the project and updating the resource.

The feasibility study estimated that OceanaGold would spend more than $60-million in capital at the Martha Underground project in 2021, and nearly $40-million in 2022.

A further near $20-million investment in the project is due in 2023, followed by a A$20-million investment in 2024, and a A$15-million investment by 2025, with the total operating expenditure over the eight year mine life targeted for $512.54-million.

At a gold price of $1 500/oz, the feasibility study estimated that the project would have a pre-tax net present value of $143-million and an internal rate of return of 47%, with a pay-back period of nearly four years. C1 costs for the Martha Underground project have been estimated at $839/oz, while all-in sustaining costs have been estimated at $1 107/oz.

The feasibility study included an initial reserve of 4.5-million tonnes, at 4.33 g/t gold for 0.62-million ounces at Martha Underground, as well as an additional 0.62-million ounces of indicated resource, which has for the most part been converted from the inferred resource.

OceanaGold has previously expressed its commitment to the Martha Underground mine, despite delays brought on by the Covid-19 restrictions, with the project still on track to start production in the second quarter of this year

In addition to the results of the feasibility study, OceanaGold on Thursday also updated its global mineral reserves and resources, increasing its proven and probable reserves by 0.75-million ounces, to 143-million tonnes, at 1.32 g/t gold for 6.06-million ounces of gold.

Proven and probable reserves of 40.8-million tonnes, at 0.99 g/t gold for 1.3-million ounces have been declared at Macraes, including 0.16-million ounces at the Golden Point underground operation, which is expected to deliver first production in the fourth quarter of this year.

Total measured and indicated resources have grown by 0.66-million ounces, to 243-million tonnes, at 1.28 g/t gold for 10-million ounces.

“We are pleased to declare gold reserves of 6.06-million ounces and 10-million ounces of measured and indicated resource, a 0.75-million-ounce increase in reserves net of depletion, reflecting our commitment to creating value through exploration, a quality asset base and consistent performance,” said OceanaGold CEO and president Michael Holmes.

“At the Waihi gold mine in New Zealand the feasibility study has defined an initial proven and probable reserve of 0.62-million ounces of gold for the Martha Underground project, confirming our confidence in delivery of the asset and our vision for the Waihi district. Just north of Waihi, drilling is ongoing at the Wharekirauponga (WKP) prospect to convert resources, test extensions to known mineralised veins and support the prefeasibility study targeted for release in late 2021.”

“On the South Island of New Zealand, the Macraes life-of-mine has been extended to 2028 and the Golden Point underground is on-track for first production later this year with an initial reserve of 0.16-million ounces of gold,” said Holmes.

He noted that at the Haile gold mine in the US, 2.43-million ounces of gold reserve is contained within the optimised open pit while an important underground reserve of 0.42-million ounce is growing through conversion of a large resource base totalling 0.53-million ounces of indicated resource and 0.9-million ounces of inferred resource.

“Exploration continues to focus on both continued resource conversion as well as underground discovery with the objective to match production from the new underground mines with the open pit operations and ultimately extend gold production past the current life of mine of 2032,” he added.