Studies move the needle at CentAm, DomRep gold projects

Mining companies have hit key milestones at gold projects in Central America and the Dominican Republic this year with a string of technical studies.

Firms have concluded PEAs and PFSs for at least four projects in the region so far in 2021, with the studies representing significant steps toward development.

The projects are all primary gold assets in Panama, Guatemala, Nicaragua and the Dominican Republic, with combined capex of US$769mn and potential production of 390,000oz/y.

TOP CENTAM, DOM REP TECH STUDIES

1. Cerro Blanco, Guatemala

Study: PEA

Capex: US$548mn

Bluestone Resources reported results of a new PEA for its Cerro Blanco project in Guatemala in Febuary, and has since upgraded resources ahead of a feasibility study.

The February study represented a major change in the company’s approach to the project, which will now focus on opportunities to mine near-surface, high-grade mineralization in an open pit operation.

The PEA showed production peaking at 334,000oz/y gold, and averaging 231,000oz/y over an initial 11-year mine life.

Initial capex is estimated at US$548mn, with the project delivering a post-tax IRR of 28.5% at a US$1,550/oz gold price and US$20/oz for silver.

Bluestone CEO Jack Lundin said in June that he expects to submit an environmental permit amendment application by end-2021, reflecting the change from the previous underground mining scenario.

Approval of the application, expected in 2H22, will allow the company to begin development. The feasibility study is due by 1Q22.

Bluestone announced a new resource estimate for Cerro Blanco in July, which incorporated an 88% increase in measured resources to 2.4Moz gold and 10.4Moz silver.

2. Cerro Quema, Panama

Study: PFS

Capex: US$164mn

Orla Mining’s July PFS demonstrated the potential of a low-cost, high-return heap leach development at the Cerro Quema oxide gold project in Panama.

The study evaluated a 10,000t/d open pit mine producing 81,000oz/y gold over an initial six-year mine life.

Initial capex is estimated at US$164mn, with post-tax IRR at 38% at US$1,600/oz gold prices.

“The completion of the PFS provides a pathway toward continued engineering, project advancement, and a future construction decision,” CEO Jason Simpson said.

“We also believe there is significant opportunity for project optimization and mineral resource expansion in Panama and work is just beginning.”

Simpson has said he will take a patient approach toward project development in Panama, and the company said in July that concession renewals are awaiting government approval, with no assurance the company will receive them within a reasonable time.

The project will also require a modification to existing permits and environmental and social impact assessment (ESIA) approval.

An ESIA was submitted in 2016 but the timing of approval remains uncertain.

3. Candelones, Dominican Republic

Study: PEA

Capex: US$36.5mn

Unigold outlined the potential of an open pit, heap leach mine targeting its Candelones oxide deposit in the Dominican Republic in a PEA in April.

The company intends to advance the project to production over the coming years, which will help generate cash to fund a longer-term project targeting the larger sulfide deposit at Candelones.

The 5,000t/d throughput operation will produce 31,000oz/y gold or 95,587oz over the life of the mine, with initial capex at US$36.5mn.

Post-tax IRR is put at 34.9% at US$1,650/oz gold prices.

“The economics are compelling enough that this is being considered as a stand-alone operation providing near-term cash flow as the company continues to expand and evaluate the larger sulfide resource which the company believes offers a longer-term development opportunity,” CEO Joseph Hamilton said.

Unigold plans to rapidly advance both oxide and sulfide projects over the next few years, he added, while advancing community consultation, environmental studies, detailed engineering and permitting at the oxide project.

4. Pavón, Nicaragua

Study: PFS

Capex: US$20.8mn

Calibre Mining reported results from a PFS at its Pavón open pit gold mine in March.

The company began mining at Pavón in January, with ore being transported to the Libertad mill for processing.

Production is ramping up during 2021.

The PFS showed a four-year mine life and average production of 47,000oz/y gold.

Total capital costs are US$20.8mn, split between US$12.0mn of non-sustaining and US$8.75mn of sustaining capex.