Equinox Gold sees California project as second cornerstone mine
TSX-V-listed Equinox Gold will significantly increase its future gold production if it develops its project in California, with output from the company’s two cornerstone mines – Castle Mountain, in the US, and Aurizona, in Brazil – estimated at almost 200 000 oz/y by 2020, increasing to 350 000 oz/y.
Announcing the outcomes of a prefeasibility study (PFS) for the Castle Mountain project, Equinox Gold CEO Christian Milau said on Monday that the mine increased the firm’s gold reserves by more than 350% to 4.5-million ounces.
The PFS contemplates a low-cost heap leach gold mine with about 3.6-million ounces of gold reserves that will produce about 2.8-million-ounces and generate $865-million in after-tax cash flow over a 16-year mine life.
Developed over two phases, Castle Mountain will realise gold production of about 45 000 oz/y over the first three years and 203 000 oz/y from Phase 2 in years four to 16.
The initial capital for Phase 1 construction is estimated at $52-million, with aspects of the Phase 2 expansion incorporated into the design to reduce the total life-of-mine (LOM) capital costs.
Phase 1 ore will be sourced primarily from a stockpile of lower-grade material at the Oro Belle and Jumbo pits, which will be placed on the heap leach pad in 15m lifts at a rate of 12 700 t/d and leached.
Initial capital for Phase 2 construction is estimated at about $295-million, including $47-million in capitalised pre-stripping.
Phase 2, which will be treating ore mined from the large Main Trend and South Domes pits, comprises two circuits whereby an average of 38 000 t/d of ore grading between 0.17 g/t gold and 1.3 g/t gold will be placed directly on the run-of-mine heap leach pad and ore above the 1.3 g/t cutoff will be milled and processed through a carbon-in-leach (CIL) circuit at an average rate of 2 400 t/d.
Total anticipated production from Phase 2 will be 2.7-million oz of gold.
The operating plan calls for 5% of the ore tonnes, containing about 29% of LOM produced gold, to be processed by CIL.
Further, Equinox Gold pointed out that there remained potential to extend the mine life and increase the yearly production, owing to Castle Mountain’s measured and indicated mineral resources being estimated at about 4.3-million-ounces of gold, inclusive of its reserves, as well as inferred mineral resources of about 2.2-million ounces and additional near-mine mineralization, which was identified with the exploration programme last year.
“Castle Mountain is Equinox Gold’s second cornerstone mine that, by itself, will generate more than one billion dollars of pre-tax cash flow at current gold prices. Successful execution of mine development at both Aurizona and Castle Mountain will establish Equinox Gold as a midtier gold producer,” said chairperson Ross Beaty.
Construction of the Aurizona mine is under way and the company is targeting first gold before the end of the year.
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