St Barbara (ASX:SBM) will implement a 3 million tonnes per annum processing plant at the 15-Mile Project to process mill feed from Cochrane Hill and Beaver Dam projects in Nova Scotia, Canada.
The plant will be relocated from Touquoy to optimise the development approach, as outlined in the concept study, to 16km northeast of Beaver Dam and 40km southeast of Cochrane Hill.
The concept study was led by Ausenco Engineering Canada, who was supported by Moose Mountain Technical Services for overall mine design and certain aspects of the study.
For a price of C$91 million, St Barbara is anticipated to return an average gold production of 106,000 ounces per annum over an 11-year mine life. The initial capital return is estimated at C$251 million ($279 million) in conjunction with a 3 million tonnes per annum throughput rate.
The all-in sustaining costs (AISC) is estimated to average US$1,197 per ounce. St Barbara believes that previous operations indicate low strip ratios and high gold recoveries.
The company says the project has “strong economics” with an estimated post-tax NPV5% that improves to $1.084 billion and estimated IRR improves to 76% (using a gold price of US$2,500 an ounce and exchange rates of C$1 = US$0.70 and C$1 = A$1.11)
St Barbara, which has a market capitalisation of $330.26 million, plans to conduct a Prefeasibility Study (PFS) in March next year.
CEO Andrew Strelein says the reassessment has redesigned the Cochrane Hill Project to reduce its environmental footprint and community impact by removing the need for tailings management and processing facilities.
“This comprehensive redesign allows Cochrane Hill to contribute to the regional production profile while aligning with environmental and social considerations,” Strelein says.
“With the addition of Cochrane Hill, the proposed processing facility at 15-Mile was well suited for a throughput expansion from 2.1 million tonnes per annum to 3 million tonnes per annum – still recycling the Touquoy process plant but with substitution of a larger ball mill.”
Meanwhile, the provincial government has added fold to the area’s list of strategic minerals, creating an industrial file team within the Department of Environment and Climate Change to avoid duplicate approvals with the federal government.
St Barabara is an Australian based explorer, focusing on its gold operations in Canada and Papua New Guinea.
Write to Maddison Elliott at Mining.com.au
Images: St Barbara
