Benchmark Metals Inc. (TSX-V:BNCH, OTCQX:BNCHF) has reported the completion of a preliminary economic assessment (PEA) on the Lawyers gold-silver project located within a road accessible region of the prolific Golden Horseshoe area of north-central British Columbia.
The PEA presents a robust open-pit mining operation with attractive economics at base case gold and silver prices of US$1,735 per ounce and US$21.75 per ounce, respectively.
CEO John Williamson said the PEA demonstrates the low cost and robust return of the Lawyer's gold-silver -project even when stress tested with considerable contingency in the base case.
“We continue on a straightforward pathway to advancement. We continue to test new targets on the large prospective land package to add value to a project that is simple, low risk with a high-grade near surface open-pit resource, combined with proximity to existing infrastructure, making it one of the best candidates to become British Colombia's next precious metal mine," Williamson said in a statement.
READ: Benchmark Metals says results of preliminary economic assessment for Lawyers project will be released in August
The project is showing a pre-tax net present value (NPV) 5% of C$921 million, an internal rate of return of 30.5% and a 2.1-year payback, with a pre-tax net operating income of C$2.14 million.
The project also shows an after-tax net present value 5% of C$577 million, an internal rate of return of 23.5%, and a 2.7-year payback.
Vancouver, British Columbia-based Benchmark forecasts a long mine life with exceptional expansion opportunity, with a total resource production of 46.3 tonnes over a 12-year mine life.
The company is also expecting average annual production of 169,000 gold equivalent (AuEq) ounces.
The PEA envisions a conventional truck and shovel open-pit mining operation, with common equipment sizing, covering the Cliff Creek, Dukes Ridge (included in Cliff Creek), and AGB pits, feeding a 10,600 tonnes per day industry standard processing plant with two-stage crushing, grinding, whole-ore leach and a Merrill Crowe recovery circuit, with production of gold-silver doré bullion on site.
Ian Harris, VP Engineering, said: "The PEA confirmed the current project development timelines, with industry standard open-pit mining methods, processing flowsheet, design criteria, and compact footprint. Multiple target high-grade resource areas have been identified near but outside the pit limits.”
The PEA has been presented with surface mining only. However, there is a strong opportunity to enhance the Base Case economics with supplemental feed from underground operations.
“There is a significant opportunity to upgrade the already robust project through adding underground mining to production scheduling. These evaluations that represent a considerable upside opportunity will be incorporated into detailed mine planning of the feasibility study," Harris said.
Production is designed to achieve a processing rate of 10,600 tonnes per day. The average mining rate is 68,000 tonnes per day of total material mined, with a maximum of 89,000 tonnes per day occurring in years six through nine.
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