GOLD STUDY: Hislop project pre-feasibility positive

ONTARIO — The pre-feasibility study for the Hislop gold project near Timmins is in, and the results are ...

ONTARIO — The pre-feasibility study for the Hislop gold project near Timmins is in, and the results are positive. The report was prepared by Scott Wilson Roscoe Postle Associates for St Andrew Goldfields of Toronto.

 

A open pit operation with the 1,500 tonnes of ore trucked daily to the company's nearby Holt mill for treatment is proposed. Capital cost are estimated at C$11.0 million with an average unit operating cost of C$42.54 per tonne milled over the life of the mine. Average annual gold production will be 30,000 oz/year at a total cash cost of US$621/oz. Project life will be approximately four years.

 

The gold price has a substantial influence on the profitability of the project, according to St Andrew. Using an average gold price of US$850/oz, the undiscounted pre-tax cash flow for the Hislop project is C$20.9 million over the mine life on a stand-alone basis. Simple payback occurs after approximately 1.5 years. The pre-tax net present value (NPV) at a 5% discount rate is C$17.2 million, and the pre-tax internal rate of return (IRR) is 99.1%. At a gold price of US$950/oz, the undiscounted pre-tax cash flow increases to C$36.2 million. For this price scenario, the pre-tax NPV at a 5% discount rate is C$30.4 million, and the pre-tax IRR is 158.4%.

 

Probable mineral reserves are 1.9 million tonnes grading 2.3 g/t Au for a total of 142,500 oz of contained gold.

 

More information about the Hislop project is available at www.SASGoldMines.com.

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