New Pacific Metals (TSX: NUAG) has released an updated preliminary economic assessment for its Carangas silver gold project in Bolivia, pegging the post-tax net present value at $2.65 billion and the internal rate of return at 35.9%.
Those figures rest on base case metal prices of $45.00 per ounce silver, $3,400 per ounce gold, $1.20 per pound zinc and $0.90 per pound lead. The economics are levered heavily to silver, with the study showing post-tax NPV climbing to $4.16 billion at $67.50 silver while a comparable move in gold barely nudges the same figure.
The updated study lifts throughput and folds in the deposit’s gold zone, changes that reshape the operation from the September 2024 version. Carangas is now envisioned as a 19 year open pit mine, excluding a two year pre-production period, producing roughly 195 million payable ounces of silver, 1.1 million ounces of gold, 1,453 million pounds of zinc and 941 million pounds of lead. On a silver equivalent basis, that totals 339.0 million ounces.
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Production would move through three phases. A conventional flotation circuit runs first, expanding from 8.0 million tonnes annually to 16.0 million tonnes in year six, before an 8.0-million-tonne gold circuit comes online in year nine. Mining wraps up in year 16, with the final three years fed entirely by stockpiles.
Production as a result is expected to average 18.9 million ounces of silver equivalent for years one through eight, 20.7 million ounces of silver equivalent from years 9 through 16, before dropping off in year 17 as stockpiles are processed.
Initial capital is estimated at $644.5 million, with life of mine capital reaching $1.2 billion once growth and sustaining spend are included. Post tax payback runs 2.4 years.
Cost metrics sit low thanks to by-product credits. Total cash costs come in at negative $1.51 per ounce of silver. All in sustaining cost averages $19.16 per silver-equivalent ounce over the mine life, or $0.11 per ounce of silver net of by-products.
In terms of next steps, a 30,000 metre drilling campaign is slated to begin in September, largely aimed at converting inferred resources to the indicated category. On the permitting side, the company is working to convert its exploration licenses to administrative mining contracts, a step it expects could take up to six months, before commencing an environmental impact study it hopes to complete by the end of 2027.
New Pacific Metals last traded at $5.45 on the TSX.
