PERTH (miningweekly.com) – A definitive feasibility study (DFS) into the Bardoc gold project, in Western Australia, has estimated that the project could produce some 135 760 oz/y over a mine life of just over eight years.
ASX-listed Bardoc Gold on Monday reported that the project would require a capital investment of some A$177-million, and would have life-of-mine (LoM) all-in sustaining costs of A$1 188/oz.
The DFS estimated a LoM pre-tax cash flow of A$740-million at a gold price of A$2 250/oz with a pre-tax net present value of A$479-million and an internal rate of return of 41%.
“The completion and delivery of this comprehensive and high-quality DFS is a fantastic achievement by our team, and marks a really important milestone for our shareholders, investors, supporters and other key stakeholders,” said Bardoc Gold CEO Robert Ryan.
“The strong DFS outcomes show that the Bardoc gold project is without question one of the best undeveloped gold projects in Australia, with the potential to deliver strong production and cash flows and compelling financial returns over a long period of time from a brand new fully-integrated mining and processing operation located right on the doorstep of Kalgoorlie.
“At the heart of the DFS is a 28% increase in ore reserves over one-million ounces, a fantastic result which reflects the highly effective drilling programmes conducted over the past 12 months and the excellent technical work completed on our mining and processing schedules, to optimise the project to a very high level.”
At the assumed base case gold price of A$2 250/oz, the project would generate some A$113-million in free cash flows a year post construction, with forecast LoM free cash flows of A$740-million.
“The project has relatively low capital intensity, with a forecast pre-production capital cost of A$177-million and a 32-month payback period from production commencement. Based on the project’s very strong financial metrics and Tier 1 location, combined with the strong team we have assembled and our very strong institutional share register, we are confident of securing a highly competitive project funding package over the coming months.”
Bardoc is expected to complete financing and announce a final investment decision in the third quarter of this year, along with early works and procurement of long-lead items. Full commercial construction is slated for the fourth quarter of 2021.
“That would put us on track to pour first gold in the fourth quarter of 2022, allowing Bardoc to make the all-important transition to midtier gold producer and to become a significant new player in the gold industry in the North Kalgoorlie region.
“In the process, we will be making a substantial investment in the Goldfields region and deliver significant economic and social benefits to communities in the areas where we will be operating and to the state of Western Australia,” said Ryan.