B2Gold ups estimated cost of Nunavut gold project by 23%
B2Gold Corp. [BTO-TSX, BTG-NYSE, B2G-NSX] has released a revised cost estimate for its Goose Project, which is located on its 100%-owned Back River Gold District in Nunavut, Canada.
The total Goose project construction, mine development, and sustaining capital cash expenditures (construction and mine development cost) before first gold production estimate is now $1.54 billion. That marks a $290 million, or 23% increase from the previous estimate.
The company said approximately 52% (or $150 million) of the increase can be attributed to a one quarter delay in first gold production (previously disclosed), combined with the acceleration of capital items that were previously anticipated to occur after first gold production.
In early trading Friday, B2Gold shares rose 2.6% or 11 cents to $4.31 and trade in a 52-week range of $4.74 and $3.18.
B2 gained control of the Nunavut asset via its acquisition of Sabina Gold & Silver Corp. in April, 2023.
The Back River Gold District, an 80-kilometre- long belt containing a series of gold deposits in banded formation, is located in southwestern Nunavut, approximately 520 kilometres northwest of Yellowknife.
Goose will be the first mine in the district. B2 Gold estimates that once in commercial production, the Goose mine will produce approximately 310,000 ounces of gold annually over the first full five years.
The company continues to estimate that gold production in calendar 2025 will be between 120,000 ounces and 150,000 ounces.
In a press release, the company said all planned construction year to date in 2024 has been completed and project construction and development continues to progress on track for first gold pour in the second quarter of 2025. That will be followed by a ramp up to commercial production in the third quarter of 2025.
However, the acceleration of certain capital items is expected to make the Goose project a more reliable and derisked operation upon mill start-up. Those include the building of an accommodation complex at the Marine Laydown Area (MLA), which is expected to reduce continuing annual costs associated with the Winter Ice Road.
The company said approximately 24% (or $70 million) of the increase in construction and mine development cost can be attributed to the increased cost of logistics and shipping materials to the Goose project site.
As previously announced, an additional three months of mining was added to the schedule to ensure that the Umwelt open pit, underground development and crown pillar activities align, and that there is significant tailings storage capacity in the Echo open pit.
The project received its final major authorizations in June, 2020, and is now in receipt of all major permits, and authorizations for construction and operations.