Greatland Resources has delivered a landmark feasibility study for its Havieron gold-copper project in Western Australia’s Paterson Province, confirming the asset as a world-class, long-life, lowest-quartile cost mine capable of generating more than $739 million in free cash flow per year.
The study outlines a 17-year life-of-mine operating period producing 266,000 ounces (koz) of gold and 9600 tonnes (kt) of copper annually, both at an all-in-sustaining-cost (AISC) of $1610 per ounce.
Greatland has also updated its ore reserve of 38.5 million tonnes (Mt) at 2.63 grams per tonne (g/t) gold and 0.33 per cent copper, for 3.3 million ounces (Moz) and 128,000 tonnes of copper.
The company added that this update marks Havieron as the largest Australian gold reserve outside of a global major gold producer. The company discovered the site in 2018 and took 100 per cent ownership of the project a year ago.
Greatland managing director Shaun Day said the team are excited by Havieron’s world-class quality.
“The results of the study are robust, generating an internal return rate (IRR) of 22.5 per cent at a long-term $4500/oz gold price,” Day said.
“At a long-term price equal to the current spot gold price, this rises to 31.5 per cent IRR.
“The assessed steady state average production target of 266koz gold and 9.6kt copper annually would generate significant after-tax free cash flow of $550 million per annum at our base case pricing, or $870 million per annum at spot gold price.”
Greatland forecasts an average steady-state processing rate of 3.9 million tonnes per annum (Mtpa), underpinned by sub-level stoping and cemented paste fill, across a mine life that includes nine years of steady-state output.
Over its entire life of mine, the project is expected to deliver $7.7 billion in pre-tax cash flow, benefitting from both gold and copper credits, assuming a long-term copper price of $15,747 per tonne.
At a base of $4500 per ounce gold price, Havieron would deliver a $2.87 billion post-tax net present value (NPV) at the slated 22.5 per cent IRR, with the long-term rise to 31.5 per cent IRR coming alongside a $5.4 billion post-tax NPV.
The updated ore reserve showcases a 55 per cent increase in tonnage, and a 36 per cent increase in contained gold from the previous reserve.
Likewise, Havieron’s mineral resource totals 131 million tonnes at 1.7g/t gold and 0.21 per cent copper, containing 7 million ounces of gold and 275,000 tonnes of copper.
Ore mined from Havieron will be processed at the Telfer plant, roughly 55 kilometres away, using Train 1, which will undergo $200 million in upgrades, including new magnetic separation, flotation tails leach, and pyrite leach circuits.
Processing recoveries from Telfer are estimated at 86.6 per cent for gold and 84.4 per cent for copper, with Greatland also flagging potential for a Telfer hub, where co-processing of Havieron and Telfer ore could further reduce fixed costs and lower the AISC.
The next phase for Havieron is expected to be fully funded from existing $750 million cash, ongoing Telfer cash flows, and a $500 million debt commitment from a Tier 1 lending syndicate of ANZ, HSBC, ING, NAB and Westpac.
“We look forward to obtaining the final permits required to take the final investment decision and resume full development at Havieron, and to outline our integrated Telfer-Havieron production plan,” Day said.
“The potential is to deliver Havieron and, in parallel, extend the mine life of Telfer to achieve the full potential of the Greatland platform.”
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