Gold Standard Ventures Corp. said Sept. 10 that a pre-feasibility study for the South Railroad gold project in Nevada outlined a posttax net present value, discounted at 5%, of US$241.5 million, a 27.8% internal rate of return and a 2.7-year payback period.
The South Railroad project is part of the company's Railroad-Pinion project and comprises the Dark Star and Pinion deposits. The study assumed a base case gold price of US$1,400 per ounce and a silver price of US$17.11/oz, envisioning the operation as an open pit mine with heap leach processing.
Initial capital expenditure was estimated at US$194.0 million, and the total life-of-mine capital required, including initial, expansion and sustaining, was estimated at US$302.7 million. The study estimated payback in 2.7 years under the base case scenario.
Average annual gold production is expected at 116,000 ounces of gold over an initial eight-year mine life at all-in sustaining costs of US$657/oz. The project is also seen producing 205,000 ounces of silver per annum from year four through eight.
Pinion and Dark Star host combined proven and probable reserves of 47.3 million tonnes with an average grade of 0.82 g/t gold and 4.70 g/t silver containing 1.2 million ounces of gold and 2.7 Moz of silver. Only the Pinion deposit contains silver.
Gold Standard plans to finalize permit applications to the U.S. Bureau of Land Management for an environmental impact statement.
Meanwhile, the company will continue drilling, looking to convert inferred resources to the measured and indicated category for addition to the mine plan at the Dark Star, Pinion and Jasperoid Wash deposits.
