Rokmaster Resources (TSXV: RKR) has chosen the last trading day of the year to release a preliminary economic assessment for its Revel Ridge polymetallic gold-silver project in British Columbia.
The project is estimated as having an after-tax net present value (5%) of C$454 million, along with a 21% internal rate of return. The payback period is estimated at 3.2 years, versus a life of mine of 11.4 years.
Those figures however are based on US$1,850/oz gold, US$23.00/oz silver, US$1.26/lbs zinc and US$0.90/lbs lead and an 80.4% gold recovery rate. Zinc notably hasn’t traded as high as US$1.27 since April 19, and currently sits at US$1.18/lbs. Lead is currently sitting at US$0.93 a pound, while silver trades at US$23.61 an ounce and gold US$2,062 an ounce.
At US$1,700/oz gold, which is more commonly used as a baseline among junior mining names, the after-tax NPV(5%) falls to US$334 million, and jumps to US$574 million under US$2,000/oz gold.
The estimate outlines an 158,000 ounce gold equivalent per year operation, which will produce at cash costs of US$540 an ounce, while life of mine all-in sustaining costs are estimated at US$836 an ounce. Pre-production capital expenditures are estimated at C$588 million, which includes contingencies of C$84 million, while its estimated to take 18 months for mine ramp access and development prior to becoming fully operational.
Estimates for the PEA were based on a mineral resource estimate completed in June of this year, which outlined measured and indicated resources of 1,526,000 ounces of gold equivalent, and inferred resources of 1,486,000 ounces of gold equivalent.
Comparably, a 2020 PEA conducted using pre-Rokmaster drilling and metallurgy identified the project as having an after-tax NPV(5%) of C$423 million, and 29.5% IRR, based on US$1,561/oz gold, US$20.55/oz silver, US$1.07/lbs zinc and US$0.91/lbs lead. That estimate was based on average annual production of 124,000 ounces of gold equivalent and a recovery rate of 83.5%.
Rokmaster Resources last traded at $0.06 on the TSX Venture.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
