Côte d’Ivoire – The optimised PFS confirms that Yaoure is a compelling gold development project despite the current capital constrained market environment.
Based on the company’s updated Mineral Reserve estimate of 3.2 million ounces (62.3 Mt at 1.62 g/t) announced on 25 January 2016, the optimised PFS successfully delivers an increased head grade, reduced upfront capital cost and robust economics at a conservative gold price.
The optimised PFS was based on a smaller 4.5 Mtpa processing plant, which was found to achieve significant improvements when compared with PFS key metrics, namely, a post-tax internal rate of return (IRR) of 38% and post-tax net present value (NPV) of US$555 million based on a discount rate of 8% and a gold price of US$1 200/oz.
The PFS also confirmed that the oroject remains strong at a gold price of US$1 000/oz with a post-tax IRR of 25% and a post-tax NPV of US$281 million
The optimised PFS was based on an average annual production of 248 000 oz in years 1 to 5 and average annual production of 203 000 oz over a 15 year life of mine (LOM) from a single open pit containing 3.2 Moz, processing an average head grade of 1.62g/t based upon the Mineral Reserve estimate.
The study determined an upfront capital cost of US$334 million, including US$44 million contingency and US$60 million for an owner-operated mining fleet, with a payback period of 2.1 years with mining throughout this period focused on the higher grade, continuous CMA zone where 72% of Yaoure’s proven Mineral Reserves are located.
The study also determined a LOM average total cash cost (including royalties and refining) of US$618/oz and average all-in sustaining cost of US$667/oz.
The company said that additional work is being completed, including reviewing other smaller plant sizes, to confirm and refine the parameters of the project to take through to bankable feasibility study stage.
“The optimised PFS has achieved both of our key objectives for Yaoure: to significantly increase the average head grade going to the processing plant and to significantly decrease the upfront capital cost,” says Amara chairman and CEO John McGloin.
As a result of the higher grade, Yaoure’s strong production profile is maintained despite using a smaller processing plant, while the reduced capital cost is also better tailored to the current capital constrained market environment.
“Yaoure’s other metrics have also improved substantially, cementing Yaoure’s position as one of the few gold development projects that achieves an IRR of 25% at a US$1 000/oz gold price,” he added.
“Due to the excellent existing infrastructure of Côte d’Ivoire, the project benefits from exceptionally low operating costs and we expect Yaoure to be among one of the lowest cost, largest new gold mines in Africa.
“We are completing work to confirm that 4.5Mtpa is the optimal processing plant size in light of the significant reduction in the cost estimates we received during the optimisation work and I expect the results to further highlight the exceptional economics and versatility of the Yaoure gold project,” McGloin concluded.