A preliminary economic assessment defined robust economics and manageable costs for Fireweed Zinc Ltd.'s Macmillan Pass zinc project in Canada's Yukon Territory, according to a May 23 release.
Using prices of US$1.21/lb of zinc, 98 cents/lb of lead and US$16.80/oz of silver, the study generated an after-tax net present value of C$448 million at an 8% discount rate, and an internal rate of return of 24%.
Pre-production capital is pegged at C$404.4 million while sustaining capital is estimated at C$649.4 million for a total project cost of C$1.05 billion and a payback period of four years.
Macmillan Pass is projected to have an 18-year mine life producing an average 85,000 tonnes of contained zinc, 48,000 tonnes of contained lead and 2 million ounces of contained silver per year.
The study was based on a mine plan for the delivery of 32.7 million tonnes at a diluted head grade of 9.07% zinc equivalent to the processing plant.
An updated resource estimate for Macmillan Pass released in January was also used in the PEA. The estimate found that the project hosts 11.2 million tonnes in indicated resources and 39.5 million tonnes in inferred resources.
"Project economics in the PEA demonstrate that Macmillan Pass is not just viable at the zinc, lead and silver prices levels contemplated in the study, but highly robust," Fireweed Zinc CEO Brandon Macdonald said.
