Bardoc Gold Ltd has taken a further step toward building a significant new mid-tier Australian gold project after delivering a positive pre-feasibility study (PFS), located 50 km north of Kalgoorlie in Western Australia.
Robert Ryan, Bardoc Gold’s chief executive, said: “The strong PFS outcomes demonstrate that the Bardoc Gold Project is one of the best undeveloped gold projects in the Eastern Goldfields, with the potential to deliver an average of 135,000ozpa at an AISC of A$1,220/oz over a seven-year production period, peaking at 170,000 oz in year five. At an assumed base case gold price of A$2,100/oz, well below current spot prices, the project will deliver robust margins and generate strong cash-flows.
“Our project development strategy is underpinned by the construction of an on-site 1.8 million tonne per annum capacity CIL plant incorporating a flotation circuit capable of producing a gold concentrate for sale to international markets,” Mr Ryan said.
Pre-production capital cost is estimated at A$142.4 million with payback of 32 months from production start, generating life-of-mine pre-tax cash flow of A$921 million at current spot price of A$2,530/oz. The pre-tax NPV is $A600 million and 55 percent Internal Rate of Return at the current spot gold price.
Mr Ryan continued, “There is substantial upside to our base case PFS numbers with strong potential to grow the 1M oz mine plan within the current 3M oz resource. In addition, with a significant exploration program planned over the coming months and a strong balance sheet, we are confident of growing the global resource, building on the recent drilling successes at the Mayday North, El Dorado and North Kanowna Star deposits.
“The definition of a 789,000 oz maiden Ore Reserve indicates the financial viability of the project, with 77 per cent of the mining plan underpinned by Ore Reserves and 80 per cent by Measured and Indicated Resources.
“The focus of our ongoing drilling will be to in-fill and upgrade a portion of the Inferred Resources to the Indicated category, so they become available for conversion to Ore Reserves, also to grow our overall Mineral Resource base, and to commence mining evaluations of the key satellite deposits. Given the already strong economics of the PFS, our focus will now be to optimise the project in terms of reserves, mining inventory, production levels, operating costs and financial returns in order to deliver the best possible return to shareholders,” Mr Ryan concluded.
*Article published in the April-June 2020 issue of The Asia Miner