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Hill End Gold pegs US$692M value, 4.1-year payback for Yendon alumina project

Hill End Gold Ltd. said June 14 that a pre-feasibility study for the Yendon high-purity alumina project in Victoria, Australia, outlined a net present value, discounted at 10%, of US$692 million, an internal rate of return of 34% and a 4.1-year payback period.

The study for the open pit operation is based on a maiden resource of 3.68 million tonnes of in-situ kaolinized material, contained in the measured and indicated categories, which support a 38-year mine life, and a forecast sale price of US$25,200 per tonne of alumina.

CapEx for the operation is pegged at US$271 million, which includes a US$53 million provision for contingency. Annual high-purity alumina production is projected at 8,000 tonnes at production cost of US$7,668 per tonne. Projected EBIT for the operation is US$4.96 billion, or US$16,762 per tonne sold.

Following the positive outcome of the pre-feasibility study, the miner will begin the completion of a definitive feasibility study, with the delivery targeted in the third quarter of 2019, concurrent to the completion of a pilot plant at the site.

Construction of the Yendon project is targeted in the third quarter of 2022, with the commissioning slated in the fourth quarter of 2022.