Osisko Delivers Upbeat PEA For Windfall Project

Osisko Mining Inc. (TSX:OSK) announced positive results from the independent preliminary economic assessment (PEA) prepared in accordance with national instrument 43-101 at its 100 percent owned Windfall Deposit located in the Abitibi greenstone belt, Urban Township, Eeyou Istchee James Bay, Québec. The PEA provides a base case assessment of developing both the Windfall and Osborne-Bell deposits as underground ramp-access mines with a central gold processing mill in Lebel-sur-Quévillon, Québec.

Highlights are as follows:

PEA Highlights
Base case gold price US$1,300.00 per ounce, silver price US$17.00 per ounce, exchange rate C$1.00 = US$0.78, 5 percent discount rate IRR after taxes and mining duties 32.7 percent NPV after taxes and mining duties C$413.2 million
Pre-production construction costs (including C$51.8 M contingency) C$397.3 million peak-year payable production 248,000 ounces (year 1)
Average LOM payable production 218,000 ounces
Net gold payable recovery 92.4 percent
Average diluted gold grade 6.7 grams per tonne gold
Life of mine (LOM) 8.1 years
Total mineralized material mined 8,914,000 tonnes
Contained gold in mined resource 1,915,000 ounces
Payable gold LOM 1,769,000 ounces, payable silver LOM 557,000 ounces
All-in sustaining costs net of by-product credits and royalties over LOM US$704.00 per ounce
Estimated all-in cost (CAPEX plus OPEX) US$879.00 per ounce
Total unit operating cost C$126.47 tonne milled
Gross revenue C$2.96 billion
Operating cash flow C$1.12 billion
Mine start-up/full production Q2 2022/Q3 2022 NPV before taxes and mining duties C$625.4 million IRR before taxes and mining duties 39.7 percent

John Burzynski, president and CEO, commented:

Today’s PEA results are excellent with a robust after-tax internal rate of return (IRR) of 33 percent and after-tax net present value (NPV) of C$413 M, based only on our initial mineral resource estimate at Windfall with its conservative grade estimate. This is a very strong start to a project that is growing as inferred resources are being converted to higher-grade indicated resources by the ongoing drill program, with optimized mining methods and with the ongoing exploration success at Windfall. The PEA envisions commencing the project with a 3,200 tonne per day long hole mining approach, focused on extracting large panels with minimum widths of 3.5 metres to 4.0 metres and minimum height of 20 metres. While this study focuses only on the larger zones of mineralization, further detailed modelling using adaptive mining methods will be applied to subsequent studies to capture the bulk of the May 14, 2018 resource, including narrow high-grade zones in the Lynx Zone which were not included in this study. The down plunge extensions of Underdog, Lynx, Zone 27, the recently discovered Bobcat zone, and the recently announced Triple 8 discovery were not included in this study, as mineral resource definition drilling in these areas is still in progress. These areas are expected to be included in the feasibility work in 2019. Osisko’s PEA outlines the strong potential base-case for significant and profitable new gold production in Quebec, and we anticipate that these great initial numbers will only get better as we progress with our large definition and exploration drilling program at Windfall.