Nova Minerals Limited (ASX: NVA) has revealed the results from its Phase 2 Scoping Study on the Estelle Gold Project (Project), located in Alaska’s prolific Tintina Gold Belt.
Key outcomes of the Study highlight the technical and financial robustness for Estelle to support a large open pit mining operation, with ideal ore body geometry that allows mining high-grade ore in the early years for a quick payback from RPM, and bulk tonnage mining from Korbel at a low strip ratio in the later years.
The Phase 2 Scoping Study confirms the potential for a commercially robust mining operation at the Estelle Gold Project with an 11 month payback period and improved financial and mining metrics, while also highlighting the impact of increasing the LOM average mill feed grade, which is now the core focus for the company in the upcoming 2023 drill programme.
“Completion of the Phase 2 Scoping Study marks a major milestone for the company, providing a robust foundation as we move towards the PFS, and exceeded our expectations in many regards with a from surface high-grade starter pit at RPM offering a quick 11 month payback period and a 53% internal rate of return that we aim to continue to improve with further optimization,” CEO, Christopher Gerteisen, said.
“With such a positive outcome and baseline to work from, we are now targeting additional near surface mineable resources to increase the average LOM mill feed grade, where the slightest increase should improve the project’s economic metrics. We have those resource targets ready to drill this year, particularly at RPM. It’s all upside from here.
“Key drivers for these robust returns are the geometry and nature of mineralization within these massive IRGS ore bodies, which start at surface to allow open pit mining with a very low strip ratio, particularly important in the early payback, as well as being readily amenable to ore sorting in the later years allowing for significant upgrading of ore feed to the mill. This combined with excellent metallurgy where our proven flowsheet can easily liberate and recover gold.
“Following the initial high grade early years, particularly the 11 month starter pit at RPM, additional key areas and opportunities have already been identified that have the potential to further improve the project’s economics.
“With the project now essentially de-risked from a capital perspective with the 11 month payback period, Nova can be viewed as having a two tier upside. Development, and most importantly exploration, as any new discoveries and increases to the resource base will now go straight to the bottom line improving the projects economic metrics.
The Phase 2 Scoping Study, based on a mining scenario which focuses on the higher grade, confirms the technical and financial robustness of a commercial mining operation at the Estelle Gold Project, with:
Financial Metrics
o Net Present Value (NPV5%) of US$654M (~ A$981M) pre-tax
o Internal Rate of Return (IRR) of 53% pre-tax
o 11 month payback period
o Undiscounted net free cashflow of US$945M pre-tax
o Annual free cash flow after the payback period of ~ US$56M pre-tax
o All in Sustaining Costs (AISC) 1st year US$510/oz and Life of Mine (LOM) US$1,149/oz o Pre-production capital of US$385M for a central processing plant and infrastructure
Mining Metrics
o Annual production first year 363Koz Au and LOM average increased to 132Koz pa
o Total production increased to 2.25Moz Au over a longer LOM of 17+ years
o Early production driven by the higher grade RPM resources with 2.02g/t Au material.
For further information please visit: https://novaminerals.com.au/
