Ausgold set to be next mid-tier gold producer

Ausgold is chuffed at the results of the Prefeasibility Study and maiden ore reserve for its fully-owned flagship Katanning Gold Project.

Ausgold is chuffed at the results of the Prefeasibility Study (PFS) and maiden ore reserve for its fully-owned flagship Katanning Gold Project in Western Australia.

The current PFS forecasts that the project will generate $981 million of EBITDA over the life of the mine and an average post-tax free cashflow during production of $70 million a year.

Over the first six years of production, the project is modelled to generate $92 million post-tax-free cashflow per annum during production, underpinning an outstanding internal rate of return of 40.7 per cent and a period of just 1.7 years required to pay back expected pre-production capital expenditure.

Ausgold’s forecast strong financial performance is based upon an annual production rate of 126,000 ounces per annum and an AISC of $1370/oz for the first six years of production.

The maiden probable ore reserve is 32mt at 1.25g/t for 1.28moz gold.

Ausgold managing director Matthew Greentree said the company was now positioned firmly on the path to becoming Australia’s next mid-tier gold producer with the project delivering a large ore reserve with excellent financial metrics demonstrating low cost, low technical risk, and a high-margin operation.

“The initial ore reserve confirms the company’s robust understanding of the Katanning gold deposit and further supports our thesis that this represents the foundation of an excellent mine operation with clear upside potential,” he said.

About Ray Chan

Editor of industrial titles and mastheads with Prime Creative Media. Publications include Rail Express and Australian Mining (web content).

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