Feasibility projects 11-year mine life for Certej gold-silver project

A feasibility study for European Goldfields’ (EGU-T, EGU-L) Certej gold-silver open-pit mining project in Romania says the operation could produce an average of 156,000 oz. gold and 814,000 oz. silver per year over 11 years.

The next thing European Goldfields needs is an environmental permit, which it expects to receive in the fourth quarter, and an updated mining permit that’s still in effect from when a Romanian state mining company operated the mine on a small-scale basis up until 2006.

Once it has those in hand, the company will move toward raising enough money to finance the 80%-owned project the study assumed a debt to equity ratio of 50:50.

Capital costs are estimated at US$214.7 million initially plus about US$49.1 million in sustaining capital.

Operating costs would be about US$353 per oz. and the project’s post-tax internal rate of return is about 20%. The IRR includes a 2% royalty on gross revenues.

A gold price of US$650 per oz. and a silver price of US$12 per oz. were used.

The study looked at mining 3 million tonnes a year at a strip ratio of 3:1. Ore would be processed first via a flotation circuit to produce a pyrite, gold-silver concentrate which would then be sent through for further grinding and ambient pressure leaching using Xstrata’s Albion process to extract the gold and silver (the Albion process includes ultra-fine grinding and oxidative leaching at atmospheric pressure).

Then a standard carbon-in-leach circuit would process the oxidized concentrate into gold and silver dor on site.

Certej is an epithermal gold-silver deposit located in western Romania. Certej reserves, which are included in the resources, are 32.8 million tonnes of ore grading 2 grams gold per tonne and 11.4 grams silver, using an 0.8 gram gold per tonne cutoff.

European Goldfields is looking into other cost saving methods that weren’t included in the study including using second-hand grinding mills and using some of the waste rock for a district highway project. The company is also considering expanding the project life to 15 years by processing existing dump material and lower grade ore in the pit that is economic over US$700 per oz.

The company also holds the Stratoni polymetallic opeation, the Olympias gold-zinc-lead-silver project and the Skouries copper-gold porphyry project in Greece.