TSX-listed Minera Alamos on Thursday announced positive preliminary economic assessment (PEA) results for the La Fortuna gold project, in Durango, Mexico.
The PEA estimates average contained metal production of around 43 000 oz/y of gold, 220 000 oz/y of silver and 1 000 t/y of copper over a five-year mine life.
The initial “starter pit” comprises two-million tons of ore, grading 3.68 g/t gold, 20 g/t silver and 0.27% copper, to be processed at a rate of 1 100 t/d.
Using metals prices of $1 250/oz gold, $16/oz silver and $5 725/t copper, the PEA demonstrated an all-in sustaining cost (AISC) of $440/oz, an after-tax net present value (NPV) at 7.5% of $69.8-million and an internal rate of return (IRR) of 93%.
La Fortuna preproduction capital costs should amount to $26.9-million and, based on the economics in the PEA, the payback period should be about four months.
“With an after-tax IRR in excess of 90%, today’s excellent PEA results confirm that the La Fortuna project provides a robust base for the next phase of gold production in the company’s growth pipeline,” commented Minera Alamos CEO Darren Koningen.
He noted that the simplified gold recovery process outlined in the study represents a conservative starting point that is well suited to the initial project resource, which is based exclusively on previously drilled mineralisation.
“As our engineering work progresses, we continue to find opportunities to reduce the initial project capital requirements and improve overall project economics.
“Coupled with our strategic partnership with Osisko Gold Royalties that includes an option to provide a significant portion of the project capital requirements in return for a project royalty, these additional optimisations will greatly reduce the upfront funding requirements of this already low capital cost operation.”