ONTARIO – The updated pre-feasibility study for the Magino gold project 40 km northeast of Wawa boasts a 76% increase in reserves and an annual gold production of nearly 300,000 oz. Argonaut Gold
, 100% owner of the former producer, put a pre-tax internal rate of return at 28% and net present value of $610 million on the project.
Assuming a gold price of $1,200 (in Canadian dollars) per ounce, Argonaut offered the following numbers: A processing rate of 30,000 t/d; gold produced in years one through three of 370,000 oz; and a payback period of 2.6 years. The initial capital cost would be $540 million followed by sustaining capital and a closure cost of $196 million. Cash costs per ounce are expected to be $581.
The Magino property was an underground mine from 1935-42 and again from 1987-92. Argonaut puts the indicated resource at 143.8 million tonnes at 0.88 g/t Au using a cut-off of 0.25 g/t, there are more than 4.0 million contained oz of gold. The inferred resources is 43.3 million tonnes at 0.76 g/t Au, containing another 1.1 million oz.
More information is available in the news release dated Jan. 18, 2016, and in the project description posted at ArgonautGold.com