Ausgold has released promising results from the Katanning gold project in Western Australia through a definitive feasibility study (DFS), showing robust returns and rapid payback.
The DFS, completed on schedule by Ausgold and Minescope Services, outlines an average gold production of 140,000 ounces per annum over Katanning’s first four years, with a total 1.14 million ounces produced across its 10-year life.
Ausgold has forecasted a post-tax cashflow of $1.37 billion and an internal rate of return of 53 per cent, at a gold price of $4300 per ounce. Project payback is estimated at just 13 months from first production.
“We are delighted with the outcomes of the DFS which clearly demonstrate the robust financial returns that will be generated by the (Katanning gold project),” Ausgold executive chairman John Dorward said.
“The on-schedule completion of this high-quality study marks a critical milestone in Ausgold’s journey to becoming Australia’s next mid-tier gold producer.”
The 3.6-million-tonne-per-annum open pit operation is projected to have all-in sustaining costs of $2180 per ounce over its first four years and $2265 per ounce over the life of mine.
Underpinned by a 1.25 million ounce ore reserve, Katanning is considered “development-ready”, with Ausgold now shifting focus to front-end engineering, design, and securing debt financing.
“We are now turning our minds to the next phase of project development, including front-end engineering and design and debt financing, while we also progress activities to finalise land access and complete permitting for the project,” Dorward said.
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