Paramount Gold Nevada Releases New PEA For Sleeper Gold Project

Paramount Gold Nevada (NYSE MKT: PZG) reported that a preliminary economic assessment has been completed for its Sleeper Gold project in Nevada. The project is expected to feature cash costs of $529 per gold equivalent ounce.
As quoted in the press release, highlights included:

• 30,000 tonnes per day heap leach process facility fed by open pit mining (approximately 11 million tonnes per year throughput with 0.72 strip ratio);
• Mineralized material containing a total 1.02 million ounces of gold and 5.1 million ounces of silver;
• Average annual production of 102,000 ounces of gold and 105,000 ounces of silver for 7 years  with additional metal recovered during final leaching of 37,850 ounces of gold and 30,500 ounces of silver;
• Payback period of 2.7 years;
• Average gold grade for the first three years of 0.47 g/T with 0.41 g/T over the life of mine (LOM);
• Low initial CapEx of $175 million and total LOM capital and sustaining costs of $259 million;
• Projected LOM average cash operating costs are US$529 per ounce of equivalent gold produced;
• LOM all-in capital, operating and sustaining costs estimated at $869 per ounce of gold equivalent;
• At a gold and silver price of $1250 and $16 per ounce respectively, the Base Case has a $244 million pre-tax net cash flow, a $167 million net present value at a 5% discount rate and an internal rate of return of 25%.

Paramount president and CEO, Glen Van Treek, said:

[W]e are very pleased with the depth of the analysis conducted by MMC. The Base Case scenario achieves the three main economic driversrequired of new mines in the current environment–low initial capital costs, low cash operating costs and rapid payback of capital. This scenario makes use of standard, proven technologies with very low technical risk. The positive economic analysis for the alternative larger pit scenario provides us with a very attractive potential expansion opportunity and sets out for us the further testing required to reduce the risks of heap bio-oxidation and possibly further evaluate within prefeasibility.

Click here for the full press release.