Capricorn Metals (ASX:CMM) has delivered a 26% increase to the Mt Gibson Gold Project’s reserve, which now contains 61.6 million tonnes at 0.9 grams per tonne gold for 1.83 million ounces.
The updated reserve represents a 380,000 ounce increase from the maiden reserve in April 2023.
Capricorn Metals, which has a market capitalisation of $1.98 billion, says an update of the April 2023 Prefeasibility Study (PFS) and financial model shows the Mt Gibson project is a “compelling economic proposition” for the company.
The company reveals that Mt Gibson has an average annual gold production of 155,000 ounces for the first 9 years of mine life at a forecast all-in sustaining cost (AISC) of $1,450-1,550 per ounce.
Executive Chairman Mark Clark says the updated PFS shows an operation with long-life, high-margin gold production averaging over 150,000 ounces per annum.
“The development of Mt Gibson will see Capricorn enter the very limited space of companies having all Australian based gold production exceeding 250,000 ounces per annum and gold reserves in excess of 3 million ounces,” Clark says.
Life of mine revenue is expected to be $4.5 billion, with a free cash flow (pre-tax) of $1.4 billion. Post capex, the company reports the pre-tax net present value is expected to be $898 million.
Further, permitting is underway with the Environment Protection and Biodiversity Conservation Act referral of Mt Gibson — submitted in December 2023 — to determine the pathway for the proposed development of the project.
The Department of Climate Change, Energy, the Environment and Water has responded to the company’s referral, which is anticipated in May 2024, and is expected to inform potential permitting timeframes.
Capricorn has implemented a strategy to accelerate project design and long lead purchasing, in conjunction with progressive receipt of development and environmental permits.
The company aims to compress the construction phase of Mt Gibson to around 12-months from receipt of regulatory approval for development.
The Mt Gibson project lies 280km northeast of Perth in the Murchison region of Western Australia.
Capricorn Metals is an Australian-based gold producer headquartered in Perth, Western Australia.
Write to Aaliyah Rogan at Mining.com.au
Images: Capricorn Metals
