Sabre PEA tables Brewery Creek at post-tax NPV at US$112 million, Yukon
Sabre Gold Mines Corp. [SGLD-TSX; SGLDF-OTCQB] reported results of a preliminary economic assessment (PEA) for the company’s 100%-owned, road-accessible Brewery Creek gold project located 55 km east of Dawson City, Â Yukon, Canada. All amounts shown are in US dollars and metric units unless otherwise stated.
After-tax NPV at 5% of $112 million at an Internal Rate of Return (IRR) of 27.6% at $1,700/oz gold increasing to $157 million at an IRR of 35.7% at $1,900/oz gold. After-tax average annual cash flow of $36 million at $1,70/oz gol, increasing to $44 million at $1,900/oz gold.
Average Annual Production of 60,000 oz/year for a total 473,000 oz gold over an initial 8-year mine life. Total cash cost of $850/oz and all-in sustaining cost (AISC) US$966/oz gold. Pre-production capital costs of $105 million with life-of-mine sustaining costs of $18 million. Payback period of 2.6 years at $1,700/oz gold.
Excellent expansion potential to extend mine life and annual production with three open prospective resource areas and several targets within a 182 km2 project boundary. Lower technical and execution risk as a past brownfields producer with existing infrastructure and road access from previous mining operation.
Giulio T. Bonifacio, President and CEO, stated: “The PEA and initial results confirms our plans to resume production at Brewery Creek with what will be low re-start capital with attractive economics which we believe will be further enhanced in 2022. Sabre Gold intends to continue the expansion of gold resources at Brewery Creek and focus on several key opportunities to enhance value. The PEA is advanced in several categories as the predecessor company was initially targeting completion of a feasibility study. Sabre Gold intends to move to a feasibility level study upon completion of the advancement of key opportunities, those of which will not impact our targeted permitting timeline. Our permitting efforts will also now focus on expanding the previously permitted area for purposes of allowing for increases to our annual production profile.”
The PEA was prepared in accordance with NI 43-101 standards and evaluated the economics of resuming mining at Brewery Creek through open pit mining and heap leaching mined material for gold recovery to dorÃ©. The PEA study was prepared by Kappes, Cassiday & Associates in cooperation with Tetra Tech Inc., Gustavson and Associates and Wood Environment & Infrastructure Solutions.
Measured, Indicated and Inferred Mineral Resource estimates have been produced for the 11 named deposits by Gustavson Associates. The results of the estimation result in Brewery Creek Project containing Measured and Indicated Mineral Resources totaling 34.5 million tonnes at 1.03 g/t, containing 1.14 million ounces of gold. Inferred resources total 35.9 million tonnes at 0.88 g/t containing 1.02 million ounces of gold.
Existing infrastructure includes the existing main access road, two-man camps with a combined capacity for approximately 100 personnel, existing 7 cell leach pad plus foundations for 3 un-built cells, existing haul road network which requires only minor refurbishment, three process solution ponds which require cleaning and new liners, and the former truck shop, a steel structure with the truck bays removed which is currently used as offices and warehousing.
Community and First Nation engagement has been a strong component of the Brewery Creek Project.