Columbus Gold Corporation is pleased to announce that Lycopodium Minerals Pty Ltd. (Lycopodium) has won the tender to complete a Feasibility Study on the Montagne d'Or Gold Deposit, located within Columbus Gold's 100% owned Paul Isnard gold project in French Guiana. Under the terms of the contract, Lycopodium will begin immediately and is expected to deliver a final Feasibility Study by Q4 2016.
Lycopodium is a leading international project management and engineering firm. The study will also be completed with the participation of globally recognized engineering consultants SRK Consulting (U.S.) Inc. ("SRK") of Denver, CO.
The Feasibility Study entails the development of an engineered construction and operating plan with considerations for social, environmental and water management, permitting, geotechnical engineering, hydro-geology, metallurgical testing, process design and mine planning.
The Preliminary Economic Assessment ("PEA") for the Montagne d'Or Gold Deposit (please see news release dated August 4, 2015) recommended proceeding to the feasibility stage. The PEA indicated positive results for the Montagne d'Or Gold Deposit including an after-tax Net Present Value (8%) of US$324 million, an after-tax internal rate of return of 23%, and approximately 273,000 ounces of gold produced per year in the first 10 years of production at an All-In Sustaining Capital Cost ("AISC") per ounce of US$711.
The Feasibility Study is being funded by Nord Gold N.V. (LSE:NORD LI) as part of a minimum US$30 million exploration and development program pursuant to which they can earn a 50.01% interest in Montagne d'Or by funding completion of the Feasibility Study no later than March 2017. Nord Gold project expenditures were $16 million in 2014, and approximately $21 million in total to date. In 2015, planned work includes in-fill drilling to increase confidence in the resource and to better define saprolite resources, conversion of Indicated resources to the Measured category, condemnation drilling of the proposed infrastructure sites, geotechnical and hydrogeological investigations, and advanced additional metallurgical test work to support processing plant design.
The PEA was prepared by SRK in accordance with the definitions in Canadian National Instrument 43-101. The PEA is considered preliminary in nature. It includes Inferred mineral resources that are considered too speculative to have the economic considerations applied that would enable classification as mineral reserves. There is no certainty that the conclusions within the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.