A feasibility study on the first phase of Trigon Metals Inc.'s restart program for its past-producing Kombat copper project in Namibia defined an after-tax net present value of US$4.6 million, discounted at 7.6%, with a 103.4% internal rate of return.
Startup capital to bring the Kombat open pits into production is estimated at US$6.4 million, which includes US$4.7 million to refurbish an existing plant at the site, according to a June 5 news release.
The plan is to mine 767,000 tonnes of ore grading an average 1.3% copper and 4.3 g/t of silver over a three-year mine life to produce a total of 9,000 tonnes of copper and 94,000 ounces of silver. All-in sustainable costs are pegged at US$2.64/lb of copper equivalent.
The open pit operation represents the first phase of Trigon Metals' life-of-mine strategy for Kombat. Future phases will include restarting various underground mines on the property, starting with Asis Far West.
The study incorporates an updated resource estimate completed in February that defined indicated and inferred resources containing 186,259 tonnes of copper, 81,490 tonnes of lead and 130,842 kilograms of silver.
The analysis includes an initial reserves estimate for the Kombat East and Kombat Central deposits that comprises 770,000 tonnes grading 1.30% copper, 0.47% lead and 4.33 g/t of silver for 9,985 tonnes of copper, 3,598 tonnes of lead and 3,322 kilograms of silver. Resources were reported exclusive of reserves, with the reserves estimate using a cutoff of 0.71% copper.
Phase-one Kombat operations are expected to generate revenue of US$58.7 million from 2019 to 2021, with free cash flows estimated at US$5.7 million over the three-year period.
Trigon Metals said in October 2017 that it had sourced US$7.7 million in possible financing and an off-take partner.
"We have submitted the feasibility study results to our off-take and project finance partner and expect sign off and the availability of the funding facility in the near term," President and CEO Stephan Theron said in the statement.
