NUNAVUT – Sabina Gold and Silver Corp. of Toronto says the results of the pre-feasibility study is positive for its 100% owned Back River gold project in the West Kitikmeot region, about 75 km from tide water at Bathurst Inlet.
The PFS expects the project to generate a post-tax internal rate of return of 16.5% and a net present value (5% discount) of $290 million. Over the life of the mine, it will generate an after tax net cash flow of $582 million on gross revenues of $3.3 billion. The initial capital cost will be $605 million, and it will bay for itself in 3.3 years from the start of operation.
Back River would have a processing rate of 5,000 t/d producing approximately 287,000 oz Au per year. Total cash costs are estimated at $685/oz Au over the 8.4-year life of the mine. All told, the mill will treat 15.0 million tonnes grading 5.69 g/t Au at a recovery of 88% Au.
The Back River PFS is based on only half the 2012 mineral resource, and does not refer to any mineralization identified by drilling done in 2013.