OceanaGold Corp. [OGC-TSX, ASX] announced results of the NI 43-101 compliant Waihi district study preliminary economic assessment (PEA) in New Zealand. All figures are in U.S. dollars unless otherwise stated.
At a Base Case (at $1,500/oz gold price), initial after-tax IRR (Internal Rate of Return) would be 51%. Initial after-tax Net Present Value (NPV) at 5% discount rate is $665-million. Life-of-mine (LOM) after-tax free cash flow is $1.1-billion. LOM all-in sustaining costs (AISC) of $627/oz with LOM cash costs of $557/oz.
Initial mine life to 2036 would be from multiple sources of mill feed. Total growth capital investment of approximately $447-million over eight years for four distinct deposits.
There is an increased resource for Martha open pit â€“ now 260,000 gold ounces in the indicated category and 290,000 ounces in the inferred category.
Michael Holmes, President and CEO, said: â€œWe are very pleased to share the positive results of the Waihi district study that represents the initial value creating potential of the district opportunities. The PEA indicates the potential for a robust project with an extended mine life for Waihi to 2036 from Martha Underground, Wharekirauponga Underground (WKP), Gladstone open pit and a cutback of the existing Martha open pit.
â€œUsing our base case assumptions, the significant exploration potential recognized at Martha Underground and WKP, combined with the existing infrastructure and skilled work force, the results of the study give us confidence to move forward in the Waihi district opportunities and as a result, we will continue advancing each forward. Additionally, we see potential for further significant growth through resource additions particularly at Martha Underground and WKP deposits. Resource expansion has the potential for sustained high levels of annual gold production and mine life extension.
â€œThe critical path for success is expected to be resource consenting of WKP and surface projects including the Martha open pit Phase 5 and additional tailings storage capacity.â€