Kin Mining NL's pre-feasibility study for its Cardinia gold project, part of the Leonora property in Western Australia, outlined a pretax net present value, discounted at 8%, of A$66.8 million, a 17% internal rate of return, and a 44-month payback period, assuming a gold price of A$2,000 per ounce.
The project is expected to produce 368,000 ounces of gold during an 8.2-year initial mine life, according to the Aug. 30 release.
The study is based on two open-pit mining centers at Cardinia and Mertondale supplying a processing plant with an annual capacity of 1.5 million tonnes, centrally located at Cardinia.
Pre-production costs for the project were estimated at A$76.9 million, and total capital costs at A$99.5 million. All-in sustaining costs during the life of mine were estimated at A$1,442/oz.
The life-of-mine revenue from the project is estimated at A$736.2 million, with surplus operating cash-flow of A$128.4 million.
At a gold price of A$2,200, the pretax NPV will increase to A$118.0 million, with a 29% internal rate of return, and the payback period will reduce to 29 months.
The life-of-mine revenue will climb to A$809.8 million, and surplus operating cash flow will jump to A$199.8 million.
The study includes an ore reserve estimate of 7.9 million tonnes at 1.1 g/t of gold for 283,000 ounces and a production estimate of 11.4 Mt at 1.09 g/t of gold for 398,000 ounces.
Gold production is expected to commence 13 months after the start of construction, the company noted.
