Pure Gold Mining Releases PEA for Madsen Gold Project

Pure Gold Mining (TSXV:PGM) has released results of a preliminary economic assessment for its Madsen Gold project in Red Lake, Ontario.
As quoted in the press release:

PEA HIGHLIGHTS
Base case parameters assume a gold price of US$1,175/oz and an exchange rate (US$ to C$) of 0.80.
All currencies are reported in Canadian dollars unless otherwise specified.

• Pre-Tax NPV_5% and IRR of $104 million and 74% respectively with a 1.5 year payback period
• After-tax NPV_5% and IRR of $76 million and 62% respectively with a 1.5 year payback period
• Mine life of 6.5 years with average annual gold production of 47,191 ounces and peak annual gold production of approximately 58,000 ounces
• Life of mine (“LOM”) diluted head grade of 8.3 g/t gold
• Mine plan considers only a portion of the existing mineral resource that is within 600 metres of surface and accessible via the existing ramp
• Pre-production capital cost estimated at $20.1 million with a 12 month pre-production period
• LOM sustaining capital costs estimated at $39.2 million
• LOM cash cost of US$571/oz⁽¹⁾ and LOM cash cost plus sustaining cost of US$692/oz

Pure Gold President and CEO, Darin Labrenz, said:

Madsen is a unique Canadian gold project with a long history of high-grade gold production. The base case PEA provides an ideal foundation for targeted growth as we look to expand the potential economics through an accelerated exploration program. The study demonstrates the value of the existing permitted infrastructure, outlining a low capital option with attractive returns based solely on a portion of the existing mineral resource. It provides a blue print for expansion, and our primary focus now is on mineral resource growth near the historic mine site with a view to increasing the existing resource and enhancing the robust base case economics.

Click here for the full press release.