Getchell Gold (CSE:GTCH) has filed the technical report for a preliminary economic assessment (PEA) outlining a US$1.004 billion ($1.38 billion) pre-tax net present value for its wholly owned Fondaway Canyon Gold Project in Nevada, US.
The results were initially announced in July.
Using a base-case gold price of US$3,200 per ounce, the PEA estimates a pre-tax internal rate of return (IRR) of 58.8% and payback period of 1.5 years. The after-tax net present value, discounted at 8%, is US$905 million, with an IRR of 53.1% and two-year payback.
The study models a contract-mining operation supplying 12,000 tonnes per day to a conventional crushing, grinding, and flotation plant over a 10.1-year mine life.
Processing 42.8 million tonnes (Mt) @ 1.38 grams per tonne gold (Au) is expected to produce 1.52 million ounces (Moz) at an average of 150,000 ounces annually, based on an estimated 80% recovery to sold metal.
President Mike Sieb says this production rate would likely place Fondaway Canyon among Nevada’s 10 largest gold operations.
“Considering the project’s sensitivity to gold price, the economic potential of the Fondaway Canyon project at today’s gold price is staggering,” Sieb says.
Total capital costs are estimated at US$265.3 million, comprising US$188.4 million in initial capital and US$76.9 million in capitalised stripping over four years.
Average operating costs are estimated at US$1,373 per ounce, while cash costs including treatment, refining, and royalties total US$1,740 per ounce.
The proposed plant would produce a gold-rich concentrate for sale to a third-party Nevada facility for pressure oxidation or roasting, followed by cyanidation.
The mine plan covers the Central Area, which represents about 68% of the global mineral resource. It excludes the Main Pit’s underground resource and open-pit resources outside the Central Area.
Fondaway Canyon hosts 22.1Mt @ 1.40g/t Au for 999,000 ounces in the indicated category and 45.6Mt @ 1.24g/t Au for 1.81Moz inferred.
The company notes the PEA is preliminary, incorporates inferred resources considered too geologically speculative for classification as mineral reserves, and provides no certainty that its findings will be realised.
SLR Consulting led the study, supported by DM Consulting and APEX Geoscience.
Getchell Gold is a Canada-based Nevada-focused gold and copper explorer primarily advancing Fondaway Canyon, a past-producing project with a resource extending across a 7km gold corridor.
Write to France Pinzon at Mining.com.au
Images: Getchell Gold
