INV releases Loma Larga gold update

INV Metals Inc. [INV-TSX; ILNLF-OTC] has released a progress report on its Loma Larga gold project in Ecuador.

“Loma Larga is one of five strategic mining projects identified by the Ministry of Energy and Non-renewable Resources and is expected to be the next large-scale mine following the successful construction of the Mirador and Fruta del Norte mines last year,” said INV CEO Candace MacGibbon.

“The company is progressing its financing and permitting efforts within the laws and regulations of Ecuador with the support from our many stakeholders, the Government, and the mining industry,” MacGibbon said.

INV said it is progressing with required re-engineering and cost estimation to update the 2019 feasibility study, incorporating the relocation of the processing and tailings facilities to its land surface rights associated with the deposit.

The update to the 2019 feasibility study will provide new capital and operating cost estimates and economics as a result of the relocation and will provide the basis for the submission of the Environmental Impact Study (EIS) that is needed to obtain the relevant environment permits for Loma Larga.

The schedule for the completion of the updated 2019 feasibility study and draft EIS is the end of the first quarter of 2020.

INV advanced on the news, rising 1.3% or $0.005 to 40 cents. The shares are trading in a 52-week range of 31 cents and 83 cents.

Preliminary work indicates that the update is not expected to have a material impact on the previously estimated costs.

The feasibility study envisages an initial production rate of approximately 3,000 tonnes per day and average annual gold production of 206,000 ounces. With an after-tax 24.7% IRR and 2.6-year payback period, the study confirms the property’s viability and demonstrates the strong profitability and economics of the project.

During the projected 12-year mine life, 2.6 million gold equivalent ounces are expected to be mined, with an average of 294,000 gold equivalent ounces mined during the first four full years.

“Loma Larga is a relatively straightforward mining project that we are committed to executing and in a socially responsible and environmentally sustainable manner,” MacGibbon said. “The underground mine and related processing infrastructure have been designed to have a very minimal footprint, with an estimated disturbance area of less than 80 hectares at the project site,” she said.

“The process plant design, the use of paste backfill, and a filtered tailings disposal method will serve to minimize the use of surface water and reduce treated water discharge.”

MacGibbon said the company will focus obtaining the required permits and financing to allow for a construction decision.

The mine is accessed via a ramp and the processing facilities will produce two concentrates for export.

Approximately 55% of the tailings will be returned to the mine as backfill and the tailings facility will be covered and revegetated upon closure.