Castle Mountain Phase 2 to expand output to over 200 000 oz/y

Phase 1 of the mine achieved commercial production in November and is expected to produce about 30 000 oz/y to 40 000 oz/y.

The feasibility study yielded an aftertax internal rate of return of 18% and a net present value, using a 5% discount, of $640-million, using a base case gold price of $1 500/oz. At a $300/oz increase in the gold price assumption, the IRR jumps to 25% and the NPV to $1.1-billion.

Initial capital costs are estimated at $389-million, excluding $121-million for a leased mining fleet. If the fleet is purchased upfront, the capital costs increases to $510-million.

The expansion will generate nearly $2-billion of net cash flow at current gold prices, Equinox Gold CEO Christian Milau said in a statement.

Phase 2 will also provide more than 400 jobs during construction and operations and extend the total mine life to more than 20 years.

“With Phase 1 in operations and Phase 2 permitting under way, Castle Mountain will be a significant economic driver in the region and a long-life cornerstone asset for Equinox Gold,” said Milau.