Steppe Gold Limited (TSX:STGO, OTCQX:STPGF) has announced the results of a feasibility study conducted on its 100%-owned ATO gold project in Mongolia, which the company said confirmed an expanded life of mine to 12.5 years, producing gross revenues of US$1.7 billion and earnings before interest, taxes, depreciation, and amortization (EBITDA) of US$584 million.
Steppe Gold said the results reinforce its current Phase 2 expansion plans with construction already underway and existing permitting and infrastructure in place.
“These results reinforce Steppe Gold’s commitment to creating shareholder value from our exciting and growing portfolio of precious metal assets,” Steppe Gold CEO Bataa Tumur-Ochir said in a statement.
READ: Steppe Gold releases 3Q update on operations at its flagship ATO gold mine in Mongolia
“We are confident that our flagship asset, the ATO Gold Project, will deliver significant upside for all stakeholders with the robust economics from this project and infrastructure already in place,” Tumur-Ochir added.
The company also noted the ATO project has an estimated initial Capex of US$128 million with all-in-sustainable costs of US$853 per gold equivalent ounce.
As well, the feasibility study showed a pre-tax net present value (NPV), using a 5% discount rate, of US$320 million with an internal rate of return (IRR) of 109%.
The study is based on a US$1,610 per ounce gold price, which the company expects will generate “strong cash flows and a rapid payback of capital.”
Steppe Gold said it anticipates first concentrates from the Phase 2 expansion in the fourth quarter of 2023.
Contact Sean at sean@proactiveinvestors.com