According to the PEA, the project is expected to require pre-production CAPEX of $792 million, including $71 million in capitalized pre-stripping. The company said Filo del Sol has a $705-million after-tax NPV using an 8-percent discount and an IRR of 23 percent.
The proposed open-pit mining operation is expected to produce about 50,000 tonnes of copper, 115,000 ounces of gold and over 5 million ounces of silver annually over a mine life of 13 years.
“The results of the initial PEA for the oxide portion of Filo del Sol are excellent,” said Filo Mining CEO Adam Lundin. He noted that only about 25 percent of the alteration zone at the project has been drilled to date, and that none of the sulfide resource is included in the PEA. “We are excited about the upcoming field season and we will now move forward with the Pre-Feasibility Study,” he added.
Filo del Sol is expected to be in operation for a total of 15 years with pre-stripping included. It is anticipated that the asset will have a capacity of 50,000 tonnes per day, at a maximum mining rate of 44 million tonnes per year, including waste material. In all, 215 million tonnes of leach material are expected to be processed over the mine’s life.
Life-of-mine revenue is split, with approximately 56 percent coming from copper, 26 percent from gold and 18 percent from silver. The cash valuation model is based on a long-term copper price of $3 per pound, a gold price of $1,300 per ounce and a silver price of $20 per ounce. Ore will be processed using a heap leach method to produce copper cathode and gold-silver dore.
The company said Filo del Sol offers a “robust resource,” with 79 percent of the mine plan derived from indicated resources. Filo del Sol has an indicated resource of 169.7 million tonnes and an inferred resource of 45.7 million tonnes, according to an August 2017 resource estimate.
Filo Mining’s share price was up 1.69 percent on the TSX at close of day Wednesday (November 29), changing hands at C$2.40. Year-to-date the company’s share price has increased 37.14 percent. Filo Mining is a member of the Lundin Group of Companies.
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Securities Disclosure: I, Melissa Shaw, hold no direct investment interest in any company mentioned in this article.