Aiming For Standalone Bullfrog Mining District Project
Corvus Gold Inc. (TSX: KOR) has announces results for its Preliminary Economic Assessment (PEA) of the Mother Lode Project (MLP) in southwest Nevada.
Results outline a potential large Nevada, standalone, mining project with attractive preliminary production and financial performance statistics. This project is expected to be the Company’s second and separate mine development target in a central location surrounded by other recent discoveries in the Bullfrog Mining District.
The initial PEA does not take into account any potential synergies and cost savings from having the North Bullfrog project approximately 10km’s away on the basis that the MLP is viewed as a 100% standalone property and development project, with its own timeline and infrastructure.
The results indicate robust economics at a gold price of $1,500/oz with pre-tax free cash flow of US$564M and post-tax NPV5% of US$303M with an IRR of 23% and strong leverage for higher gold prices with a US$1.11B pre-tax cash flow at US$1,900 gold price and post-tax NPV5% of USD $663M with an IRR of 42%,
President and CEO, Jeffrey Pontius, said the Mother Lode Project may provide Corvus with a future production growth option to increase its gold production profile in the Bullfrog Mining District beyond its initial mining project at North Bullfrog. MLP could position Corvus for expanding organic production growth and possible further District consolidation of other assets.
“The results from our initial PEA study of the Mother Lode standalone project are encouraging,” Mr Pontius said.
“The potential projected annual gold production of over 200,000 ounces per year during the first three years is significant, especially as a new project, which could provide an increase to the Corvus Gold future production profile.
“The PEA demonstrates the preliminary potential for the project, on its own, to produce significant free cash flow and after tax NPV5%.
“Corvus now has a number of strategic alternatives available to it to drive shareholder value. Given the recent interest in the Bullfrog Gold District from multiple producing companies with adjacent land packages, Corvus’ compelling and accretive projects and its commanding land position with what we believe is demonstrated high exploration potential, has positioned the Company to deliver increased shareholder value.”
The Mother Lode Project is modelled as a large, open-pit, with a biological oxidation mill to treat the higher-grade sulphide mineralisation and a heap leach pad for treatment of oxide mineralization.
The mining plan utilises standard mining practices and has a production scale that is currently being used by many operating mines.
The new PEA study, which assumes a standalone project, also includes a number of other changes to the previously assumed concept for the combined Mother Lode-North Bullfrog project configuration which enhance the project.
