Castelo de Sonhos Gold Project
The Castelo de Sonhos gold project is situated in the southwestern Pará state, Brazil, approximately 20km from the town of Castelo de Sonhos. It is a paleoplacer gold deposit with 19 km of conglomerate outcrop. Large upside potential remains with only around 60% of the prospective area drilled thus far.
- 26,750 Ha property, 100% owned → no external ownership
- Deposit open along strike and down-dip → growth potential
- Substantial amounts of the target prospective area still untested → growth potential
- Gold resource has grown by factor of 7 in last three years → efficient exploration
- Robust Preliminary Economic Assessment → strong financial metrics
- Mineralization at surface → simple open pit
- Good metallurgical properties → high gold recovery
- Connected to grid power, close to highway → good infrastructure
The plateau hosts several identified mineralized conglomerate targets:
- In Esperança East, the largest of the under-explored, high-priority targets, 2018 drilling has shown reefs with higher grades and thicknesses than previously believed and has also shown that mineralization extends further to the south.
- Esperança South continues to provide positive assay results, indicating that the well-mineralized reefs may thicken to the north
- The New Discovery Zone on the west and the Upper Conglomerate Zone, have only recently been discovered and have not yet been drilled.
Preliminary Economic Assessment
Preliminary Economic Assessment results in November 2018 indicate pre-tax IRR of 51% at a current gold price of US$1250, with a low cost base and strong leverage for higher gold prices. The PEA Fact Sheet can be downloaded here.
Key Economic Parameters
|Cash Flow||US$ millions||441||372|
|NPV 5%||US$ millions||319||264|
|NPV 10%||US$ millions||233||188|
|Initial Capital||US$ millions||184|
|Life of Mine Production||Moz gold||1.1|
|Average Annual Production||oz gold||130,000|
|Payback Period (Mine Life)||years||1.9 (of 8.1 years)|
The PEA is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves. There is no certainty that the economic results described in the PEA will be realized. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
Details are reported in press release dated Nov 16, 2018 titled '51% IRR from PEA at TriStar Gold’s Castelo de Sonhos Project’
The PEA has outlined several areas for future work to enhance and continue to de-risk the project. TriStar intends to undertake additional drilling with the aim to further expand mineral resources and increase confidence.
Location and Infrastructure
- Pará state Brazil, an established mining jurisdiction.
- Far from environmentally sensitive areas and indigenous communities
- 20km from the town of Castelo de Sonhos
- Connected to ports and cities by paved national highway 163 through the town
The property was connected to the national grid power from the town of Castelo de Sonhos in early 2018.
The project currently has mineral resources of:
Indicated: 17.7 million tonnes at 1.2 g/t, containing 0.7 million ounces (“Moz”) of gold.
Inferred: 39.8 million tonnes at 1.0 g/t, containing 1.3 Moz of gold.
The resource has grown by a factor of 7 in the past three years and upside potential remains. Exploration is ongoing and new mineralised areas identified in 2018 are yet to be drill tested.
Drilling significant intervals can be viewed here.
As at September 17, 2018
Numbers have been rounded to reflect the precision of Inferred and Indicated mineral resource estimates.
The reporting cutoff of 0.3g/t gold corresponds to the marginal cutoff for an open pit with operating cost (processing + G&A) of $US 10/t, metallurgical recovery of 98% and a gold price of $US 1,200/oz. These are mineral resources and not reserves and as such do not have demonstrated economic viability.
The metal content estimates reflect gold in situ, and do not include factors such as external dilution, mining losses and process recovery losses.
TriStar is not aware of any environmental, permitting, legal, title, taxation, socio-economic, marketing or political factors that might materially affect these mineral resource estimates.
Further details available in the September 17th 2018 press release entitled “35% INCREASE IN RESOURCES AT CASTELO DE SONHOS AS PRELIMINARY ECONOMIC ASSESSMENT BEGINS”
Details are reported in press release dated Sept 17, 2018 titled ‘35% Increase In Resources At Castelo De Sonhos As Preliminary Economic Assessment Begins’