Lumina Gold backs new Ecuador President in project update
Lumina Gold Corp. [TSXV-LUM,OTCQX-LMGDF] has released a progress report in relation to its 100%-owned Cangrejos gold-copper project in southwest Ecuador, where the company is executing a 2023 feasibility study drill plan with nine rigs on site.
Meanwhile, the company said it believes Ecuador’s newly elected President Daniel Noboa will continue policies supportive of mining in that country. “He has said that he will prioritize the attraction of foreign investment and that responsible mining has great potential to be an important source of financing for social projects and generation of employment,’’ Lumina said in a press release.
Lumina shares were unchanged at 42 cents and trade in a 52-week range of 71 cents and 26.5 cents.
In its latest update, Lumina said has been advancing work related to the feasibility study, which is expected to be completed by the first quarter of 2023. The company said over 11,000 metres have been completed out of a planned 18,000 metres of resource, geotechnical and metallurgical drilling. The drill program is expected to be finalized by the end of the year.
The Cangrejos project covers 6,374 hectares in the Andean foothills and is located in El Oro province, 30 kilometres southeast of the provincial capital of Machala and the Pan American Highway. It is also situated 40 kilometres from the deep-water commercial port of Puerto Bolivar. The property is accessible via paved and eight kilometres of gravel roads.
“Cangrejos is an exceptional gold deposit and one of the few of this scale that is 100% controlled by an independent developer,’’ the company has said. “Ecuador has made substantial progress in its mining sector with the successful commissioning of the Fruta del Norte and Mirador [mines]. Now the country will turn its focus to the next generation of development projects,’’ Lumina has said.
Back in April, 2023, the company announced the results of a preliminary feasibility study (PFS), which it said demonstrated further improvements on a preliminary economic assessment (PEA) released in June, 2020,
The PFS envisages, life-of-mine average annual gold equivalent production of 469,000 ounces of gold equivalent (AuEq) over a lifespan to 26 years. The AuEq estimate includes 371,000 ounces of payable gold production annually. It also forsees 41 million pounds of copper production during the mine’s lifespan.
Other PFS highlights include a 30,000 tonnes per-day processing operation from years one to three, with an expansion to 60,000 tonnes in year four and 80,000 tonnes in year seven.
The initial capital cost is pegged at US$925 million, including working capital, excluding refundable value added tax.
The PFS is based on probable gold reserves of 11.6 million ounces, and an indicated gold mineral resource of 16.8 million ounces.
Lumina said the PFS allowed the company to commence negotiating terms for its investment protection agreement and begin the permitting process required for Cangrejos to begin construction. “We believe this is one of the best gold and copper development assets globally based on its surrounding infrastructure, scale and multi-decade mine life,’’ said Lumina President and CEO Marshall Koval.