Moto Goldmines (MGL-T, MOE-A, MOE-L) stepped closer to bringing its half of the Kilo-Moto gold belt in the Democratic Republic of Congo (DRC) back into production.
While parts of the property had been the home to Belgian run mines back in the 1950s, the highly prospective land has gone through its share of political turmoil in the last ten years.
But with the completion of a prefeasibility study, Moto is making a future mine look like more of a reality.
The study estimates gold production of at least 290,000 oz. a year at an average cash operating cost of US$274 an oz.
Capital and infrastructure costs are projected at US$296 million.
In a press release, the company says the study clearly demonstrates the projects “world class potential.”
The study was based solely on the project’s indicated resources of roughly 55 million tonnes averaging 2.9 grams gold for just over 5 million oz. The Moto project also has inferred resources of 88 million tonnes grading 3.8 grams gold for nearly 11 million oz.
The company estimates average annual pre-tax operating cash flows to be in the neighborhood of US$90 million over 8 years giving the project a pay back period of roughly 3 years.
In addition the study says 2.81 million oz. of probable reserves would be retrievable via open pit methods.
The study was done using a US$500 per oz. cut off while base financial evaluations for the base case scenario were completed at US$600 per oz.
The Moto Gold Project is situated in northeastern DRC.
Moto can acquire between 60 and 68% of certain mineral rights at the project by funding exploration through to the completion of feasibility; by providing loans of up to US$1 million to one of its joint venture partners; and by issuing a 100,000 common shares for every 250,000 oz. of gold identified in two concessions, up to a maximum of 800,000 shares. State run L’Office des Mines d’Or de Kilo-Moto (OKIMO) and Belgian Orgaman are Moto’s joint venture partners.
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