ONTARIO – The results of the preliminary economic assessment are positive for the Timmins West project belonging to Lake Shore Gold of Toronto. The study says the property has the potential to produce 1.4 million oz of gold over a 10-year period. A single underground mine would exploit both the Timmins West deposit and adjacent Thunder Creek deposit.
The Timmins West project has an indicated resource of 5.8 million tonnes averaging 5.99 g/t Au plus an inferred resource of 4.3 million tonnes at 5.76 g/t Au.
Lake Shore expects it would cost approximately $93 million to develop the mine and $67 million to boost capacity to 3,000 t/d from 2,000 t/d at the Bell Creek mill where the ore would be treated. Based on current market conditions, the project has an undiscounted cash flow of $1.14 billion, a pre-tax net present value (5% discount) of $880 million and an internal rate of return of 115%. The project would have a payback period of 1.25 years.
Cash operating costs are anticipated to be US$625/oz, but the company believes it can rein in the operating costs and trim the capital requirements as the project is optimized. “Also,” Lake Shore president and CEO Tony Makuch said, “underground gold mines in the Abitibi Greenstone Belt have a very strong track record of growing their ounces considerably once in production.”
Learn more at LSGold.com.