PEA Assumes 5,000 TPD Run-Of-Mine Heap Leach Operation
Unigold Inc. (TSXV:UGD) has released a robust independent Preliminary Economic Assessment (PEA) on its 100% owned Candelones Oxide Project in the Dominican Republic.
Chairman and CEO, Joseph Hamilton, said the PEA had identified an operation with an average annual payable gold production of 31,000 ounces.
“The Candelones Oxide project has been designed as a small footprint, environmentally friendly operation that will establish the company in the local area of the Dominican Republic,” Mr Hamilton said.
“The economics are compelling enough that this is being considered as a stand-alone operation providing near term cash flow as the company continues to expand and evaluate the larger sulphide resource which the company believes offers a longer-term development opportunity.
“The company will move to rapidly develop both projects over the next few years as it concurrently moves the oxide project through required community consultation, environmental studies, detailed engineering and permitting while completing metallurgy, preliminary design and market studies for the sulphide project.
“Recent exploration drilling at the Candelones Extension identified additional potential for oxide resource expansion to the east of the known deposit while continuing to expand the available sulphide resource.”
The resource mined in this PEA includes inferred mineral resources which contribute approximately 27% to the life of mine production schedule.
“The company intends to complete the additional drilling recommended by our lead consultant, Micon, to rapidly upgrade this inferred resource to measured and indicated status, allowing it to be included in the planned Feasibility Study,” Mr Hamilton said.
“The company intends to transition directly into a Feasibility Study on the oxide project as soon as possible. Additional oxide material has been collected and is being shipped to Canada for large diameter, run of mine column tests to confirm the recovery assumptions used in the PEA.
“We are targeting the end of 2021 to have all materials and studies assembled to allow the Government to proceed with permitting of this project.”
Highlights:
- PEA assumes 5,000 tonnes per day (tpd) run-of-mine heap leach operation
- Average annual payable gold production of 31,000 oz
- 50% Pre-Tax Internal Rate of Return (IRR), 35% After-Tax IRR
- US$50 Million Pre-Tax Net Present Value (NPV), US$34 Million After-Tax NPV
- After-Tax Payback Period 1.8 years from start of production
- Average annual after-tax free cash flow of US$23 Million
- Initial capital expenditure (Capex) of US$36 Million (includes US$5 Million for EPCM and indirect costs in addition to US$5 Million as contingency)
- AISC of US$744/oz Au
- Average gold recovery of 75%; total cash operating cost of US$13/tonne
- Creation of approximately 100 direct jobs and 50 indirect jobs during operation
- Direct taxes payable to Government of $24 million over life of mine
