Name and Location
Nueva Esperanza gold/silver project, Atacama, Chile.

Client
Kingsgate Consolidated.

Project Description
A prefeasibility study (PFS) on the Nueva Esperanza project has delivered positive economics, with the project technically and financially viable at a silver price of $19/oz and a gold price of $1 200/oz.

The project has measured, indicated and inferred mineral resources estimated at 39.4-million tonnes grading 0.39 g/t of gold, 66 g/t of silver for 490 000 oz gold and 83.4-million ounces of silver or 1.88-million ounces of gold on a metal equivalence basis.

The project comprises the Arqueros, Chimberos and Teteria orebodies. Mining will be sequenced to maximise cash flow by extracting the highest-value ore blocks as early as possible.

Each pit has been staged with a number of push-backs to assist in maximising cash flow. Lower-grade material will be stockpiled and treated towards the end of the project. The selection of ore blocks for mining is based on the highest revenue generated by the gold and silver metal.

No gold equivalents are used in the selection of mining blocks.

Mining rates are reasonably consistent at 26-million tonnes a year, and are achieved using a fleet of two excavators, up to two front-end loaders and a fleet of 100 t trucks.

About one-million tonnes of ore and waste will be mined prior to the mill being commissioned.
The process plant, which will be located 3 200 m above sea level, consists of a primary crusher, a semiautogenous and ball mill, leaching and metal extraction by Merrill Crow.

Tailings are dewatered in a filter press and stacked as dry in a valley fill.

The design process rate is two-million tonnes a year.

Throughput rates have been designed using the 75% percentile for hardness and abrasiveness.

Grind size will be P80 120 μm and the leach time will be 48 hours. The plant will treat 23-million tonnes over the 11.6-year mine life.

Life-of-mine metal production will be about 275 000 oz of gold and 47-million ounces of silver.

Production over the first five years will be an average of 135 000 oz/y gold equivalent calculated at a 60:1 silver to gold ratio.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 5% discount rate, of $168-million and an internal rate of return of 25%, based on a $1 200/oz gold price and a $19/oz silver price.

Value
Capital for the project is estimated at $206-million.

Duration
Mining is expected to be completed in six years.

Latest Developments
Based on the encouraging results of the PFS, Kingsgate is progressing feasibilities and permitting in 2016. This will allow for the consideration of development options in 2017.

Kingsgate will concurrently undertake significant exploration drilling programmes to increase the mineral resource and improve the mill feed after Year 6 of the mine plan.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Kingsgate Consolidated, tel +61 2 8256 4800, fax +61 2 8256 4810 or email info@kingsgate.com.au.