Sandstorm Gold provided a summary of the results of the feasibility study of the Turkish Hod Maden project, (FS), in which the company has a 30 per cent stake. All figures reported are based on 100% of the project.
Using a 5 per cent discount rate, FS reports putting Hod Maden projects at a net present value of $1.05 billion after tax ((NPV)) and an internal rate of return ((IRR)) of 36 per cent.
The total cost of gold maintenance (AISC), uses copper as a by-product credit, estimated at $334 per ounce. On a co-product basis, the AISC is $595 per ounce. The upfront capital cost of the project is US $309 million.
The Hod Maden project has proven and possible mineral reserves of 2.45 million ounces of gold and 287 million pounds of copper. Studies have shown that a 13-year-old mine can produce about 195000 ounces of gold equivalent per year, with an average head grade of 11.1g / ton AuEq.
FS treats Hod Maden as an underground mine, divided into two different mining areas. The improved drift and filling (DAF) technology will be used in the upper mining area, while the long hole stop (LHS) technology will be used in the lower mining area where most of the mineralization is located.
The annual production capacity of the mine is 800000 tons, and a total of 8.7 million tons of ore are produced during the 13-year life of the mine.
The ores to be processed are divided into two categories: ordinary ores and pyrite ores. When pyrite ore is processed to maximize gold recovery, the process is reconfigured. Copper and pyrite concentrates will be transported to a port in Turkey's Black Sea and then to smelting facilities.
"the release of the Hod Maden feasibility study is not only an important turning point for the project, but also an important turning point for Sandstorm," Nolan Watson, chief executive of Sandstorm, said in a press release.
"when we bought a stake in Hod Maden in 2017, we knew it would be the main growth catalyst for Sandstorm, and the positive results of this study show how transformative it will be once it goes into production," he added.
With the release of FS, the, Hod Maden project is now entering the next phase of development. According to Sandstorm, operators of the project have begun applying for forestry permits after receiving final approval from the Environmental impact Assessment ((EIA)) earlier this month.
Production of the Hod Maden is now expected to begin in the second half of 2024, the company said.
