Quebec-focused Monarques Gold has unveiled the results of its feasibility study of the Wasamac project, which CEO Jean-Marc Lacoste says has the makings of a “great gold mine”.
The project, which is a past-producing mine, will produce an average of 142 000 oz/y over an 11-year mine life at a production cost of C$720/oz and an all-in sustaining cost of C$826/oz, TSX-listed Monarques reported on Monday.
At a gold price of $1 300/oz, Wasamac has an after-tax net present value of C$311-million, an internal rate of return (IRR) of 18.5% and a 3.9-year payback period. Initial capital expenditure has been estimated at C$464-million including about C$230-million for the mill and tailings facility.
The study leaves the door open to a potential custom milling option, which if pursued, would increase the project’s IRR and decrease the payback period.
“The mine infrastructure will be strategically located on our newly acquired land next to the Trans-Canada highway and 200 m from the railway leading to all the main regional custom milling facilities,” said Lacoste.
He explained that the feasibility study was based on a top-down approach and use the Rail–Veyor system through a twin-ramp access and haulage facility, which eliminated the hefty initial capital expenditures associated with building a shaft. It also increased flexibility in mine planning and it shortened the timeline to production.
Monarques is aiming to start the process plant construction in the fourth quarter of 2020 and to reach full production capacity by the fourth quarter of 2022.
The project is expected to provide jobs to an average of 250 construction personnel, peaking at 420 in the third quarter of 2021. Over its life-of-mine operation, about 300 people will be required.
The release of the results of the Wasamac study comes only weeks ahead of the temporary shutdown of the company’s Beaufor gold mine.