Eldorado Gold (TSX: ELD; NYSE: EGO) released the positive results of a new technical report for its wholly-owned Lamaque gold project in Val d’Or, Que. One welcome upside is the potential to increase production to 190,000 oz. gold per year from the 51,354 oz. produced in 2021.
The Lamaque project is comprised of three separate but contiguous properties: Lamaque South (Upper and Lower Triangle zones and the Parallel and Ormaque deposits), Sigma-Lamaque and Aumaque. The Upper and Lower Triangle zones are currently being mined via the recently completed Triangle-Sigma decline.
The study includes an update to current operations, updated economics for the Upper Triangle zone, and preliminary economic assessment of the inferred resource in the Lower Triangle zone.
Using a gold price of US$1,500 per oz. the Upper Triangle reserves have a net present value with a 5% discount of $459 million. The Lower Triangle inferred resource has an NPV of $162 million and an internal rate of return of 33%. The Ormaque inferred resource has an NPV of %197 million and an IRR of 39%.
Should a gold price of US$1,900 per oz. prove realistic, the economics are even better. The Upper Triangle reserves would have an NPV of $673 million. The Lower Triangle inferred resource would have an NPV of $295 million and an IRR of 48%. Likewise, the Ormaque inferred resource would have an NPV of $285 million and an IRR of 45%. If the inferred resources of the Lower Triangle and Ormaque can be converted, mining would start there in 2026.
The new technical study is divided into three parts depending on the area of interest.
Based on the reserves in the Upper Triangle zone, mining will continue for another 5.5 years. The requirement for growth capital is estimated at $70 million and for sustaining capital is $230 million.
The inferred resources of the Lower Triangle zone would provide an ore source for 4.5 years. The requirement for growth capital would be $86 million and sustaining capital of $239 million.
The inferred resources at the Ormaque deposit could be mined for 3.5 years. Growth capital is estimated at $20 million and sustaining capital at $88 million.
Measured and indicated resources in the Upper Triangle zone are 6.2 million tonnes grading 8.65 g/t gold for 1.7 million oz. contained gold. The inferred material is 1.8 million tonnes at 6.63 g/t gold for 382,000 oz. contained gold.
The Lower Triangle inferred resource is 6.4 million tonnes at 6.89 g/t gold for 1.4 million oz. contained gold.
The Ormaque deposit has an inferred resource of 2.2 million tonnes grading 11.74 g/t gold for 839,000 oz. contained gold.
The Parallel deposit at Lamaque South has an indicated resource of 221,000 tonnes at 9.87 g/t gold for 70,200 oz. contained gold. The inferred resource is 200,000 tonnes at 8.83 g/t gold for 56,700 oz. contained gold.
Proven and probable reserves at the Lamaque mine include the Upper Triangle zone, Parallel deposit, and a surface stockpile. The reserves total 4.7 million tonnes grading 7.29 g/t gold for 1.1 million oz. contained gold.
“The Lamaque project has been an outstanding acquisition for Eldorado Gold,” said Eldorado president and CEO George Burns. “We acquired the asset for approximately $360 million in 2017, published a PFS in 2018, and reached commercial production 12-months later. Since then, we have demonstrated a track record of success by replacing reserves year-over-year and exceeding peak production levels beyond the 2018 Pre-Feasibility Study. Additionally, we have more than doubled the inferred resource base since the acquisition.”
Eldorado’s 2022 exploration program is focused on resource expansion at Ormaque and in the Upper and Lower Triangle zones and testing new targets within our expanded license area to support continued growth at Lamaque.
More information is posted at www.EldoradoGold.com.
April 18, 2024
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