ONTARIO – Toronto-based North American Palladium (NAP) has filed a prefeasibility study and mineral reserve estimate for phase one development of the Offset zone at its Lac des Iles palladium mine 85 km northwest of Thunder Bay. Proven and probable reserves contain almost 1.1 million oz of palladium.
Using a 2.5 g/t cut-off, the proven and probable reserves of the Offset zone total 7.74 million tonnes grading 4.30 g/t Pb (plus platinum, gold, nickel and copper). The restated measured and indicated resources are 22.05 million tonnes grading 4.41 g/t Pd, and the inferred portion is 13.67 million tonnes at 3.49 g/t Pd.
The company says that using current metal prices (US$750 palladium price), the economic analysis shows $226 million in undiscounted post-tax cash flow (determined as net revenue less operating and capital costs) for the initial Offset zone reserves, a 95% internal rate of return (over a 27-month payback period), and a net present value of $187 million at a 5% discount rate.
NAP says it plans a $79-million capital investment this year as operations transition from the open pit to underground in the Roby zone. The expenditure will cover development work in the Offset zone reserves, sinking the shaft to the 825-metre level, and sustaining capital related to the mine expansion.
See NAP.com for more information.