Study is bullish on Lewis Ponds

The Lewis Ponds project in New South Wales, Australia, has the potential to become a profitable mine, according to an independent study.

Tri Origin Exploration (TSE) commissioned the study, which focused on the Central lens of the Main zone, as well as Tom’s zone. These deposits, respectively, contain delineated reserves of 2.7 million tonnes averaging 3.6 grams gold and 123 grams silver per tonne, plus 0.21% copper, 2.56% lead and 4.17% zinc, and 1 million tonnes of 1.95 grams gold and 214 grams silver, plus 0.3% copper, 5.36% lead and 7.91% zinc. (The hangingwall and footwall lenses in the Main zone contain an additional 4 million tonnes of low-grade resources and were not included in the study.)

The study concluded that 700,000 tonnes of material could be mined from the two deposits simultaneously, resulting in an 8-year mine life. Specifically, production would come from 3 million tonnes in the Central lens and 2 million tonnes in Tom’s zone. Preproduction capital costs were estimated at $64.5 million, and operating costs would amount to $58.85 per tonne.

Based on these assumptions, the project has a net present value of $24.5 million and an internal rate of return of 20%

Based on metal prices on Jan. 31, the delineated resource is valued at US$602 million, which is equivalent to an in situ gold resource of 1.5 million oz. The net smelter return payment of metals in both deposits is estimated to be $305 million, equivalent to 750,000 oz. of recoverable gold.

Tri Origin is considering optioning the property to a company that would advance it to the feasibility and development stages.