The 2022 FS Would Have Been Much Higher if…......the X-ray sorter were not used and if the upgraded Pine Cove mill were used.
As I reported earlier, Maritime will not be using the XRay Sorter as 5% of the gold resources are lost as waste in the separation process.
This will save about $15 million in capex and infrastructure costs.
The cost of the Nuggett Pond upgrade of $30 million in capex will not be needed, with the availability of the Pine Cove mill.
Further, gold recovery will be 98% for the upgrade Pine Cove mill versus 95% for Nuggett Pond.
What was the effect on gold production using the X-ray Sorter and Nuggett Pond mill.
Well, just 247,000 ounces were produced from 272,000 ounces of reserves.
That is , actual gold recovery was just 90% of Available Reserves.
Using the upgraded Pine Cove Mill and opting out of the X-ray sorter, gold recovery in the 2022 FS would have been 267,000 ounces ( 98% of 272,000 ounces ).
Thats a substantial gain of 20,000 ounces of gold over the 5 year LOM which at $1750 US per ounce would have added about $35 million US = $45 million CAD to the NAV.
Then remove another $45 million in capex for the Nuggett Pond upgrade plus the X-ray Sorter and you have added a combined $90 million to the estimated after tax NPV5 of $105 million cad.
That is, the 2022 FS NAV would have been nearly doubled to about $200 million cad.
Do a few calculations using $2500 POG and the 2022 FS after tax NPV5 would have been about $375 million CAD.
This, on just a 5 year mine life for HD only.
As should be obvious to most and exemplified in the 2020 PEA, high grading in the initial mine years is standard procedure .
That is, the first 5 years of the 2022 FS now being upgraded to include Orion and Stoger , will have high grade production from HD in the first five years , followed by Orion, Stoger and the three New discoveries around the HD mine.
I will estimate those years and production from available documented data...
GLTA