Barkerville Gold Mines (TSXV: BGM) announced on Monday afternoon that the company has received positive results from an independent preliminary economic assessment (PEA) on its Cariboo gold project, located in the historic Wells-Barkerville mining camp of British Columbia.
The PEA provides a base case assessment of developing Cariboo as an underground mine with a gold pre-concentration plant in Wells and gold processing in the company’s existing upgraded Quesnel River mill.
Based on the PEA, the project has an after-tax internal rate of return (IRR) of 28% and an after-tax net present value (NPV) of C$402 million with a capex of C$306 million, using only about half of the current mineral resource estimate.
Additionally, the study envisions mining up to 4,000 tonne per day using a long hole mining approach.
“A key outcome of our extensive mining and processing test work is the ability to produce a high-quality concentrate averaging 20.5 Au g/t at the mine site and continued use of our upgraded Quesnel River mill for final processing,” says President and CEO Chris Lodder. “This, along with optimization of the mining method, allows us to include lower grade resources in the mine plan.”
Average production at Cariboo based on PEA calculations total 185,000 oz/year over an 11-year mine life. Peak annual production could reach 206,000 oz.
Earlier this year, the company updated the underground resources at Cariboo, reporting a 50% increase over the 2018 resource estimate.