QUEBEC — Alexis Minerals of Toronto is considering a mid-2010 start-up date for its Lac Pelletier gold project in Rouyn Noranda after it received a preliminary economic assessment (PEA) that indicated such a venture will be profitable at US$887/oz gold. The study estimates that the Lac Pelletier mine offers a 155% internal rate of return (IRR) and generates over C$20.7 million free cash flow on production of approximately 118,100 oz of gold over a three-year project life.
The company says Lac Pelletier offers it an opportunity to bring a second satellite mine into production to complement cash flow earned from the Lac Herbin mine in Val d’Or, QC. Total annual gold production would increase in 2010 to between 75,000 and 85,000 oz with both mines in production.
The study estimates total pre-production capital expenditures of C$8.8 million net of recovered gold. Total operating costs are projected at C$144/t (includes shipping and current, third-party custom milling. Total cash costs are projected to be US$554/oz.
To get the Lac Pelletier project into commercial production by the middle of next year, Alexis will complete mine refurbishment and a 40,000-tonne bulk sample in 2009.
The Lac Pelletier deposit contains and estimated total of 410,000 oz of gold. Proven and probable reserves are 483,362 tonnes at 7.60 g/t Au. The measured and indicated resource is 917,883 tonnes at 7.11 g/t Au, and the inferred portion is 391,770 tonnes at 6.52 g/t Au.
Additional information is posted at www.AlexisMinerals.com.