Studies Identify Significant Upside At Pilbara Conglomerate Gold Project
Novo Resources Corp. (TSX: NVO) has completed a preliminary economic assessment (PEA) for the company’s 100%-owned Beatons Creek conglomerate gold project in the Pilbara region of Western Australia.
In addition to the potential viability of mineral resources at the Project reported by the PEA, Beatons Creek displays significant upside resource potential from deposit extensions. Novo has identified numerous new near-surface exploration targets across its approximate 1,250 sq. km of land holdings across the Nullagine mining district.
Beatons Creek PEA highlights:
- The potential for average 100,000 oz conglomerate gold production per year over six years for 627,000 oz potential total production over life of mine (LOM), excluding current underground resources
- Comparable production costs among the field of current and imminent Australian gold producers: LOM C1 cash costs of US$702/oz and LOM all-in sustaining costs (AISC” of US$974/oz
- Robust base-case scenario: at a gold price of US$1,700/oz and an A$-US$ foreign exchange rate of 0.75:1, potential for pre-tax US$318 million (C$400 million) NPV5% and average annual EBITDA of US$88 million / post-tax US$250 million (C$315 million) NPV5%
- Synergistic combination of Beatons Creek with pre-existing production infrastructure acquired pursuant to the acquisition of Millennium Minerals Limited
- Considerable upside potential recognised in Beatons Creek conglomerate resource expansion potential as well as throughout the consolidated Nullagine mining district
“Completion of this PEA demonstrates the strength of Beatons Creek,” Chairman and President, Quinton Hennigh, said.
“The PEA indicates the potential viability of mineral resources at Beatons Creek, with a competitive AISC of US$974/oz. Given the expansive nature of gold-bearing conglomerates in the Nullagine region, there is the potential for the resource base to grow through step-out exploration and support an extension to the LOM. The robust anticipated cash generation reported by the PEA should support Novo’s exploration activities across its vast holdings in the Pilbara, with further potential to grow production organically.”
Novo’s board of directors has ratified management’s recommendation to mine the Project based on the PEA. The company is currently in the late stages of commissioning Millennium’s Golden Eagle processing facility and continues to ramp up mining and production into Q2 2021.
