Tahoe Resources TAHO

New THO news on La Arena II evaluation. looking good!

[peep2]

https://www.stockwatch.com/News/Item.aspx?bid=Z-C%3aTHO-2571207&symbol=THO&region=C
"Tahoe PEA pegs La Arena II NPV at $824-million

 

2018-02-20 19:06 ET - News Release

 

Ms. Alexandra Barrows reports

 

TAHOE ANNOUNCES RESULTS OF LA ARENA II PRELIMINARY ECONOMIC ASSESSMENT

 

Tahoe Resources Inc. has released the results of its preliminary economic assessment for La Arena II, a copper-gold porphyry project in Peru. Tahoe expects to continue its evaluation of La Arena II with the intent of advancing it to the prefeasibility or feasibility stage. The timeline and estimated capital required to advance the project to the next stage are under review. The project will be evaluated in the context of existing operations and pipeline opportunities with the intention of progressing it responsibly in order to maximize value for Tahoe's shareholders.

 

La Arena II PEA Highlights:

 

Total Measured and Indicated Mineral Resources of 5.6 million ounces of gold and 5.8 billion pounds of copper and Inferred Mineral Resources total 683 thousand ounces of gold and 349 million pounds of copper

21 year mine life

Average annual production of 149 thousand ounces of gold and 207 million pounds of copper, plus an additional 226 thousand ounces of gold and 115 million pounds of copper recovered over a two year pre-production period

Total gold and copper recovered in dore and concentrate over the mine life is estimated to be 3.4 million ounces of gold and 4.5 billion pounds of copper

Open pit mining rate of 80,000 tonnes of mill feed per day, with flotation processing to create a high-quality copper+gold concentrate, with run-of-mine heap leaching of oxide gold cap

Capital costs estimated at $1.36 billion for initial project capital (net of pre-production operating credit) and $1.09 billion for sustaining capital over the mine life

Average annual after-tax cash flow of $273 million

Average co-product cost of $600 per ounce gold and $1.55 per pound copper (1) . Average annual cash operating costs are $395 million. Total operating cost is $12.87 per tonne processed

The base case economic estimate is an after tax net present value of $824 million, using a 8% discount rate, and an after-tax internal rate of return of 14.7% with a payback period of 4.6 years at metal prices of $3.30/lb copper and $1,300/oz gold

Drilling at depth demonstrates the continuation of mineralization below the bottom of the resource pit shell at similar grades

Existing infrastructure synergies between at La Arena and La Arena II include skilled workforce, power line, and roads

(1) Please refer to "Non-GAAP Financial Measures" in this press release

 

Mineral Resources as of January 1, 2018 for the La Arena II project are summarized as follows:"

[ch08532]

Finally some good news. It’s a big project with significant debt raise. With Escobal online THO can move this project forward with free cash flow from existing portfolio. Lets hope for a speedy resolution in Guatemala and move forward without more shareholder dilution. I suspect the stock will get some much needed love

[petersburggray]

I disagree that the La Arena news is positive. La Arena has less than 3 yrs of reserves rigjt now and capital required to get new open pit at LaArena is greater than THO current market cap so it is unrealistic to think THO get access to this much cash. For this kind of money THO could buy mines with greater productionin safer jurisdictions like U.S.A. or Canada. THO could buy half of Kirkland Lake

[petersburggray]

peep if THO can borrow over $1bn to invest in LaArena then LaArena will have 21 year mine life. If not then reserves are depleted at LaAreana in about 2.5 years. LaArenaII is a pitful low grade deposit. For same money THO invest in pitiful LaArenaII THO could buy out Hecla. Hecla has a Canadian gold mine producing about 2x the gold now per yearthan what LaAreanaII will produce should THO find a