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(Wallace Refiners) – Equinox Gold (TSX: EQX), (NYSE: EQX) announced today the results of a feasibility study for the phase 2 expansion at the company’s 100%-owned Castle Mountain gold mine, located in California, USA.
According to the company’s statement, on a standalone basis, phase 2 is expected to produce 3.2 million oz of gold at average all-in-sustaining costs of $858 per oz of gold sold. Using the base case $1,500/oz gold price, phase 2 has an after-tax net present value of $640 million (discounted at 5% from the start of phase 2 construction) and an internal rate of return of 18%.
The project is expected to generate $1.3 billion after-tax cumulative net cash flow ($2.0 billion at $1,800/oz gold) with 218,000 oz average annual gold production. The project’s 14-year mine life has expansion potential from exploration, plus two to three years of residual leaching and final rinsing.
Castle Mountain achieved phase 1 commercial production in November 2020, with expected production of 30,000 to 40,000 oz of gold annually. The current operation consists of a run-of-mine heap leach facility placing 12,700 tonnes of ore per day. Phase 2 will expand heap leaching and incorporate milling of higher-grade ore, increasing production to an average of 218,000 oz per year for 14 years followed by leach pad rinsing to recover residual gold. Life-of-mine production including phase 1 operations and end of mine life rinsing is estimated at 3.4 million oz of gold.
Equinox Gold is a Canadian mining company with seven operating gold mines and one mine which is under construction. Equinox Gold operates entirely in the Americas, with two properties in the United States, one in Mexico and five in Brazil. On December 16, 2020, Equinox Gold announced its friendly acquisition of Premier Gold Mines, which will bring further diversification and scale with the addition of a producing mine in Mexico and a construction-ready project in Ontario, Canada.
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