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In other February 20 news, Northern Freegold Resources TSXV:NFR released the anticipated preliminary economic assessment for its Freegold Mountain gold-silver-copper-molybdenum project in the Yukon. Using a 5% discount rate, the report estimates a pre-tax net present value of $614.8 million and a 23.4% internal rate of return. The after-tax numbers show a $357.8- million NPV and 17.5% IRR.
The open pit’s pre-production capex comes to $499.7 million with payback in 4.2 years. Over an 11-year lifespan, annual production estimates show 150,000 gold ounces, 17.3 million copper pounds, 4.2 million molybdenum pounds and 355,000 silver ounces. With credits for other metals, the study projects average gold cash costs of $399 an ounce.
Mining and processing of about 30,000 tonnes a day would begin at the project’s Nucleus deposit before moving to a separate pit at the Revenue deposit in five years. But the company stated that “numerous mineralized showings occur outside the current NI 43-101 resource areas with similar characteristics to Nucleus or Revenue which have seen minimal exploration.” Nucleus and Revenue, meanwhile, remain open at depth and width. (Read about their resource estimates here.)
The central Yukon project is linked to the territory’s main highway by a 70-kilometre road to the town of Carmacks. In January Western Copper and Gold TSX:WRN released a feasibility study that proposed building a 132-kilometre road from Western’s Casino copper-gold-molybdenum-silver property through Freegold Mountain to connect with the highway and eventually the Pacific port of Skagway, Alaska. Freegold Mountain’s connection to the electrical grid would require a new 30-kilometre spur line.
Northern Freegold shares opened February 20 at $0.105, the same price as their previous close. The stock hit a daily high of $0.11, then fell to $0.095 before closing at $0.10.
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