Business
Chesapeake Announces Strong PEA Results for Phase 1 Heap Leach Mine at Metates with Pre-Tax NPV of US$1.1 Billion (C$1.4 Billion) and 35% IRR
Vancouver, British Columbia--(Newsfile Corp. - July 26, 2021) - Chesapeake Gold Corp. (TSXV: C...
About this update from Chesapeake Gold Corp.
[{"type":"text","content":"Chesapeake Announces Strong PEA Results for Phase 1 Heap Leach Mine at Metates with Pre-Tax NPV of US$1.1 Billion (C$1.4 Billion) and 35% IRRVancouver, British Columbia--(Newsfile Corp. - July 26, 2021) - Chesapeake Gold Corp. (TSXV: CKG) (OTCQX: CHPGF) (\"Chesapeake\" or the \"Company\") is pleased to report the positive results of the Preliminary Economic Assessment (\"PEA\") for the Phase 1 mine plan (\"Phase 1\") of the Metates gold-silver project in Durango, Mexico. Phase 1 evaluates the initial development of Metates as a low cost, scalable heap-leach operation. The PEA demonstrates robust project economics with optionality for expansion into a significantly larger operation. The PEA was prepared by M3 Engineering & Technology of Tucson, Arizona (\"M3\") with input from other prominent industry consultants.HIGHLIGHTS OF PHASE 1 PEA:(All financial figures are in U.S. dollars unless otherwise noted)Compelling Project Economics: Pre-tax NPV of C$1.43 billion (US$1.14 billion) and 35% IRR at $1,600 per ounce gold and $22 per ounce silver at a 5% discount rate, over a 31-year mine life (\"LOM\").Production Metrics: Average annual production of over 110,000 ounces of gold and 2.5 million ounces of silver during the first 15 years. All-in sustaining cost (\"AISC\") of $748 per gold ounce with a LOM low stripping ratio of 2.2:1.Significant Cash Flow: Average annual pre-tax free cash flow of $113 million in the first 15 years, and cumulatively $2.7 billion LOM.Initial Capital Cost and Payback: The PEA contemplates an initial capital cost of $359 million, including $64 million in contingency costs. Payback 2.5 years.Scalable Operation: Phase 1 15,000 tpd mine is expandable to 30,000 tpd, to bring production forward and reduce the 31-year LOM.Resource Optionality: The PEA only focuses on the higher-grade intrusive hosted portion of the Metates orebody, which represents less than 20% of the total mineral resource.Highlights Sulphide Heap-Leach Technology Potential: Management believes there is a strategic opportunity for Chesapeake across the precious metals industry to enhance the project economics of sulphide orebodies globally.The PEA demonstrates strong financial performance and rapid capital payback developing Metates as a sulphide heap leach operation. The site's simplified process flowsheet, compact footprint and proximity ...