Wallbridge PEA pegs Fenelon annual gold output at 212,000 oz over 12 years

The underground project has an after-tax net present value (5% discount) of $721 million and an internal rate of return of 18% at a gold price of US$1,750 per ounce. Annual gold production will be 212,000 oz. over the 12.3-year mine life.

The mine, tailings facility, 7,000-tonne-per-day mill and paste backfill plant has a pre-production capital requirement of $645 million and a sustaining capital requirement of $594 million. Payback will be achieved in 4.2 years. The all-in sustaining costs (AISC) are expected to be US$924 per oz. of gold.

“Projects such as Fenelon, with a projected annual production profile of more than 200,000 gold oz., located in a mining-friendly jurisdiction with established infrastructure, having substantial exploration upside and access to clean hydro-electric energy are highly desirable yet exceedingly rare in the mining industry today,” said Wallbridge chair Tony Makuch. “We are extremely pleased that the PEA on Fenelon alone is demonstrating robust economics at this early stage.  We expect further improvements as we continue to add to the resource base through our exploration efforts at Fenelon and elsewhere on our very large land position in the northern Abitibi greenstone belt.”

Fenelon has an indicated resource of 21.7 million tonnes grading 3.4 grams gold per tonne for 2.4 million ounces. The inferred resource is 18.5 million tonnes at 2.9 grams gold for 1.7 million ounces.

BMO analyst Andrew Mikitchook said in a research note on Tuesday that the PEA’s annual production estimate and AISC meets market expectations and puts Fenelon among few projects in a top mining jurisdiction with production of more than 200,000 oz. per year.