A study has confirmed an improved economic picture for New Pacific Metals’ Carangas silver-gold project in Bolivia, with the updated preliminary economic assessment more than doubling the after-tax net present value to $2.65 billion, supporting annual production of 18 million oz. of silver equivalent over a 19-year mine life.
The updated PEA, completed by Ausenco, factors in a higher processing rate and includes a new gold-only zone not included in the 2024 study. Using base case metal prices of $45/oz. silver, $3,400/oz. gold, $1.2/lb zinc, and $0.9/lb lead, the after-tax internal rate of return is 35.9%, with a payback period of 2.4 years and an initial capital outlay of $644.5 million.
The mine plan calls for life-of-mine production of 195 million oz. of silver, 1.1 million oz. of gold, 1.45 billion lb. of zinc, and 941 million lb. of lead, or 339 million oz. of silver equivalent. All-in sustaining costs are pegged at $19.16/oz. of silver equivalent.
"The strong project economics and manageable upfront capital are expected to support annual production of 10 million oz. of silver and 1 million oz. of gold over the mine life," New Pacific said.
The company added it will push ahead with 30,000 meters of infill drilling while seeking to convert its exploration license into an administrative mining contract and kick-starting the environmental impact assessment.
BMO Capital Markets analyst Kevin O’Halloran noted the updated study has "significantly improved" the economic value of Carangas by adding a gold-only zone at depth and a higher mill throughput, boosting BMO’s Carangas net asset value for the company by 13%.
He emphasized Carangas as a "key value driver" for New Pacific as it advances the project. Investors will watch closely as additional inferred resources are upgraded to indicated status through drilling, O’Halloran said.
The study reaffirms Carangas as one of the largest undeveloped silver projects in the Americas, but bringing it into production goes beyond just economic value. Bolivia faces significant hurdles from fuel shortages and foreign exchange restrictions to regulatory uncertainty and slow permitting.
Industry consultant Juan Ignacio Guzmán, in a July investment note, said the country must improve legal stability, infrastructure, and institutional credibility to unlock its vast mineral potential. He suggested that orderly permitting and transparent regulation — not faster approvals — will determine whether Bolivia can transform large-scale mineral resources into operating mines.
