Guyana Goldfields target price up after updated feasibility study

Casimir Capital raised its price target on Guyana Goldfields following the release of a long-awaited feasibility study update for the Aurora project in Guyana late last week, according to a Proactive Investors article.

Casimir Capital is a natural resource investment bank specialising in metals, mining, minerals, energy, oil and gas companies.

The Tetra Tech Inc.-led study estimated the after-tax internal rate of return (IRR) at 38% and the net present value, at a 5% discount rate, at US$800 million, assuming a base-case gold price of US$1,300 per ounce.

Casimir analyst Stuart McDougall noted that the results marked a “significant improvement” over the feasibility study last February, which estimated a base-case after-tax IRR of 12.7%.

According to the article, although the NI 43-101 report is pending, around US$72 million in savings were won with the use of “fewer and smaller surface trucks”, and around US$200 million from the elimination of a vertical shaft and backfill plant, as well as about US$46 million from the removal of SAG milling and tailings thickening.

The latest report also saw a 19% decrease in life-of-mine average cash costs, reflecting a tighter mine site, a 49% reduction in the stripping ratio, and a 49% decline in underground unit costs.



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