Theta Gold's TGME Project DFS Confirms NPV of AUD432 Million
FS KEY BASE CASE RESULTS:
- Transvaal Gold Mining Estate (TGME) Underground Gold Mine Project, which initially includes 4 mines (Phase 1) - Beta, Frankfort, Clewer-Dukes Hill-Morgenzon (CDM) and Rietfontein - located near the towns of Pilgrim's Rest and Sabie in Mpumalanga Province, 370km northeast of Johannesburg;
- The TGME Gold Project contains more than 43 historical mines with a longer-term plan to bring these large shallow goldfields back to production with minimum capital expenditure. Additionally, there is 3.6 Moz of Inferred Mineral Resources available for future development - not included in the Base Case LOM plan;
- Execution ready with Front-End Engineering Design (FEED) of the TGME gold plant complete. Plant designs support long-term growth initiatives;
- Phase 1 of the Initial 12.9 year LOM plan at the processing rate of 540 ktpa with key physical parameters including;
o Gold ore production build up over the first 41 months is 45 ktpm from the initial four mines;
o Free-milling stand-alone processing plant, with dore produced on site to produce 80 - 100Koz p.a. @ 5.18 g/t recovered gold - at 87.1% gold recovery rate;
o First gold production is scheduled for Q2, 2024
o Gold plant expected to produce over 100koz/pa by the third year of production;
o Recommission of existing on-site Tailings Storage Facility (TSF);
o LOM plan outlines a recovery of 1.08 Moz gold from 1.24 Moz mined;
o LOM plan includes 558koz Proven/Probable Reserve covering over 7 years of mining and 662Koz of Inferred Mineral Resource;
o The focus of the mining strategy remains on extracting all the mineable Mineral Resources, including 53% of Inferred Mineral Resources; and
o Over 3 Moz of Inferred Mineral Resources available for future development are not included in the Base Case LOM plan.
- Under average gold prices of US$1,642 / oz (A$2,189 / oz), the FS demonstrates strong financial returns (based on LOM plan), including:
o Undiscounted free cash flows of US$508m (A$678m), pre-tax US$717m (A$956m);
o NPV (at a 10% discount rate) of US$219m (A$292m), pre-tax US$324m (A$432m);
o Capital payback period of 31 months;
o Pre-tax IRR of 65%;
o Combined Underground Projects have an AISC of US$834/oz (A$1,112/oz); and
o Peak Capital requirement is US$77m (A$103m) , total capital US$174m (A$232m)
- Potential upside beyond the FS includes:
o Phase 2 - Increase production to include 7 mines, with an expanded processing plant to 80 ktpm producing up to 160 koz p.a. within five years;
o Enlarging mineral resources via exploration targets, alongside the incorporation of additional mines from 40 neighbouring historical mines - located within a short distance to the planned plant;
o Adoption of ESG fundamentals during the planning, design and development stages of the project, which aims to deliver a reduction in energy consumption, diversify the talent pool, and attract suppliers / contractors who utilise sustainable products;
o Tendering of mine services contracts in South Africa to achieve the most competitively priced outcome; and
o All current reserves and LOM material are hosted in shallow orebodies.
- Two scheduling strategies have been investigated, namely:
o Base Case: LOM Plan targeting the total Mineral Resources (Measured, Indicated and Inferred); and
o Ore Reserve Plan: LOM Plan targets only Measured and Indicated Mineral Resources.
Both schedules are presented in Table 1 to 3, Appendix A*, and both demonstrate strong project economics.
*To view tables and figures, please visit:
About Theta Gold Mines Limited
Theta Gold Mines Limited (ASX:TGM) (OTCMKTS:TGMGF) is a gold development company that holds a range of prospective gold assets in a world-renowned South African gold mining region. These assets include several surface and near-surface high-grade gold projects which provide cost advantages relative to other gold producers in the region.
Theta Gold Mines core project is located next to the historical gold mining town of Pilgrim's Rest, in Mpumalanga Province, some 370km northeast of Johannesburg by road or 95km north of Nelspruit (Capital City of Mpumalanga Province). Following small scale production from 2011-2015, the Company is currently focussing on the construction of a new gold processing plant within its approved footprint at the TGME plant, and for the processing of the Theta Open Pit oxide gold ore. Nearby surface and underground mines and prospects are expected to be further evaluated in the future.
The Company aims to build a solid production platform to over 100Kozpa based primarily around shallow, open-cut or adit-entry hard rock mining sources. Theta Gold Mines has access to over 43 historical mines and prospect areas that can be accessed and explored, with over 6.7Moz of historical production recorded.
Theta Gold Mines Limited