Lumina Gold: new PEA shows increased mine life of 25 years
(Kitco News) - Lumina Gold Corp. (TSXV: LUM) is upbeat about results from a new preliminary economic assessment for its 100%-owned Cangrejos gold-copper project in Ecuador, reporting an increased amount of metal and a longer mine life of 25 years.
The study, initiated in late 2019 by an independent team of consultants, demonstrates what the company called “substantial improvements” from a preliminary economic assessment that was conducted in 2018, with the addition of Gran Bestia, increased mineral resource definition and improved process flow sheet, Lumina said.
Marshall Koval, president and chief executive officer, said the after-tax net present value of Cangrejos increased by over $600 million to $1.6 billion. Also, the report shows average annual gold production of 366,000 ounces per year over a mine life of 25 years. The 2018 study showed annual output of 373,000 gold ounces for a shorter mine life of 16 years. The company projected payable by-product copper production of 46 million pounds annually, up from 43 million in the earlier study.
The amount of “contained gold” for the life of mine rose to 11.4 million ounces from 7.5 million, while the amount of “contained copper” increased to 1.5 billion pounds from 0.9 billion.
“Cangrejos is an exceptional global gold deposit and one of the few of this scale that is 100% controlled by an independent developer,” Koval said. “Ecuador has made substantial progress in its mining sector with the successful commissioning of Fruta del Norte and Mirador. Now the country will turn their focus to the next generation of development projects.”
Lumina said that base-case economics were calculated using a gold price of $1,400 per ounce, copper price of $2.75 per pound, molybdenum price of $9 per pound and a silver price of $16 per ounce.
The study listed average cash operating costs of $545 per gold ounce and all-in sustaining costs of $604, after by-product credits. The PEA looked at large-scale open-pit mining using an owner-operated equipment fleet, the company said.
The report listed life-of-mine processed grades of 0.56 grams of gold per metric ton and 0.10% copper. The life-of-mine revenue mix was put at 78.9% gold, 19.4% copper and 1.7% molybdenum, plus silver output.
Initial capital costs, including working capital and refundable value-added taxes, were estimated at $1 billion.