Video: Gold mining faces a cliff after 2025, CRU analyst predicts
Global gold production will peak at about 3,250 tonnes (105 million oz.) next year, according to CRU's Oliver Blagden.
Northern Dynasty said on Wednesday that Wardrop completed a positive preliminary assessment report for the Pebble copper-gold-molybdenum project in Southwestern Alaska.
“For the Pebble Project, the 45-year Reference Case yields a 14.2% pre-tax IRR, a 6.2-year payback on initial capital investment of $4.7 billion and a $6.1 billion pre-tax NPV at a 7% discount rate and long-term metal prices. At current prevailing metal prices, the 45-year Reference Case yields a 23.2% pre-tax IRR, a 3.2-year payback on initial capital investment and a $15.7 billion pre-tax NPV at a 7% discount rate.”
The company listed key findings in the report:
•The Pebble deposit supports open pit mining utilizing conventional drill, blast and truck-haul methods, with an initial mine life of 25 years and potential for mine extensions to 78 years and beyond.
•The potential exists for underground block cave development at a mining rate of 150,000 tons per day to emerge as the preferred mining method for phases of development beyond 25 years.
•The process plant employs conventional crush-grind-float technology and equipment with a nominal throughput of 200,000 tons per day, as well as secondary gold recovery. Average mill throughput for the first 25 years would be 219,000 tons per day, rising to 229,000 tons per day for the 45-year and 78-year cases.
Other project facilities and infrastructure include: a 378 megawatt natural gas-fired turbine plant at the mine site; an 86-mile transportation corridor to Cook Inlet for road and pipeline rights-of-way; and a new deep-water port on Cook Inlet.•Construction of the Pebble Project would take four years, and employ a peak labour force of 2,080. The operations workforce averages 1,120 over the first 25 years of mining.
•The 45-year Reference Case processes 3.8 billion tons of material with a strip ratio of 2.1:1 and average grades of 0.46% copper, 0.011 oz gold per ton and 214 ppm molybdenum.
•The 45-year Reference Case produces 31 billion lb copper, 30 million oz gold, 1.4 billion lb molybdenum, 140 million oz silver, 1.2 million kg rhenium and 907,000 oz palladium, while mining 32% of the total Pebble mineral resource.
•Economic valuations are expressed in US dollars in real terms utilizing long-term metal prices of $2.50/lb copper, $1,050/oz gold, $13.50/lb molybdenum, $15/oz silver, $3,000/kg rhenium and $490/oz palladium.
Pebble transportation corridor and port site location. Image from Northern Dynasty
The Pebble project is located 200 miles southwest of Anchorage and 1,000 feet above sea-level. The Pebble project is a partnership between Northern Dynasty and Anglo American.
“Under the terms of the Pebble Limited Partnership Agreement, Anglo American is required to elect to commit $1.425 to $1.5 billion in staged investments in order to retain its 50% interest in the Pebble Project. If a feasibility study for the Pebble Project is completed after 2011, Anglo American’s overall funding requirement increases from $1.425 billion to $1.5 billion. Funds provided by Anglo American are currently being invested in comprehensive exploration, engineering, environmental and socioeconomic programs toward the future development of the Pebble Project.”
Northern Dynasty shares were down 10 per cent on Friday morning to $17.55 a share. Trading volume was high. The 52 week high for the stock was $21.76 and the low was $6.
Michael Allan McCrae wrote this story. You can contact him at [email protected].
