Equinox to Build a $103m Brazil gold mine
Equinox Gold ready to start production at its Santa Luz gold mine, which is set to start contributing cash flow to the company in just over a year’s time.
The $103-million mine, in Bahia state, Brazil, will produce over 903 000 oz of gold and generate $436-million in after-tax net cash flow over an initial 9.5-year mine life from 1.1-million ounces of openpit gold reserves.
At $1 500/oz gold, the project has an after-tax net present value discounted at 5% of $305-million with an internal rate of return of 58%.
“We continue to deliver on our sector-leading growth by launching into full construction at Santa Luz, after pouring first gold at our Castle Mountain mine less than a month ago and first gold at our Aurizona mine only 15 months ago,” CEO Christian Milau said on Monday.
Santa Luz is a brownfield past-producing mine and the majority of site services and infrastructure is already in place. The initial capital costs to restart the mine include refurbishing existing infrastructure, retrofitting the plant, installing additional grinding power and increasing the storage capacities of the existing tailings and water storage facilities.
Openpit stripping is expected to begin in February. Modifications and upgrades to the processing plant and tailings and water storage facilities are expected to be finished by the end of 2021, with first gold pour targeted for the first quarter of 2022.
Meanwhile, Equinox also announced its third-quarter results, reporting record gold sales of 128 000 oz and $98-million in earnings from mine operations, with adjusted net income of $39-million.
“Proactive Covid-19 testing and improved health and safety protocols have enabled us to operate our mines safely while protecting the health and economic well-being of our workforce and local communities. Unfortunately, a community blockade has temporarily stopped operations in Los Filos. We met with the community to understand and discuss their concerns and to continue looking for a long-term solution so that Los Filos can resume normal operations and continue to benefit everyone involved, ”said Milau.
