A preliminary economic assessment on Sandspring Resources Ltd.'s Toroparu gold project in Guyana has reduced preproduction capital expenditure by C$123 million to C$378 million, from C$501 million estimated in a 2013 pre-feasibility study.
The latest study also outlined a posttax net present value, discounted at 5%, of C$495 million, with a 20.25% internal rate of return and 2.92-year payback period. The 2013 study pegged aftertax net present value at C$691 million, internal rate of return at 23.14% and payback in 2.63 years.
The study is based on mining from three open pits allowing for the production of 4.5 million ounces over a 24-year life span, up from 3.7 million ounces previously. The project has been rescoped to include the Sona Hill satellite deposit as well as modifying the processing strategy to start with gold-only production from a carbon-in-leach circuit for the first 10 years.
During the first five years, gold production will average 175,000 ounces, ramping up to an average 217,000 ounces after year 11.
This would be followed by an expansion in year 11 to add flotation processing and a streaming agreement with Wheaton Precious Metals Corp.
After-tax free cash flow was estimated at C$1.25 billion, while all-in sustaining costs are estimated at C$812 per ounce.
Toroparu has a measured and indicated resource of 252.6 million tonnes at 0.91 g/t for 7.35 million ounces of gold and inferred resources of 128.9 million tonnes at 0.76 g/t for 3.2 million ounces of gold.