- Josemaria Resource’s flagship copper-gold-silver Josemaria Project is located in Argentina’s San Juan province
- Company has recently published its NI 43-101 compliant feasibility study on the project
- Mine expected to generate an average annual production of 136,000 tonnes of copper, 231,000 ounces of gold and 1,164,000 ounces of silver over its 19-year life
- Study indicates $1.53 billion after-tax Net Present Value at an 8% discount rate, 15.4% Internal Rate of Return at metal prices of $3.00 per pound copper, $1,500 per ounce gold, $18 per ounce silver
- The Josemaria Project return increases to $US2.3Bn After-Tax NPV8 and 18.5% IRR as calculated by metal prices on November 12, 2020 of $US3.14/lb Cu, $US1883/oz Au and $US24.33/oz Ag (https://ibn.fm/zR4Ip)
- JOSE anticipates a 3.8-year, rapid payback period on initial capital investment from start of production
Josemaria Resources (TSX: JOSE) (OTC: JOSMF) (Nasdaq Stockholm: JOSE), a Vancouver, BC, Canada-based natural resources company, recently released the results of an independent NI 43-101 compliant feasibility study on its flagship project, the wholly-owned copper-gold-silver Josemaria Project located in the San Juan Province, Argentina (https://ibn.fm/DlDYg). Prepared by a team led by Fluor Canada Ltd. alongside SRK Consulting (Canada) Inc. and Knight Piesold Ltd., the study revealed a robust and relatively low-risk project with a rapid 3.8-year payback period. The mine is planned as an open pit operation feeding a conventional process plant at a Life-of-Mine average rate of 152,000 tonnes a day over a 19-year mine life.
The feasibility study projects average annual metal production of 136,000 tonnes of copper – equivalent to nearly 0.7% of annual global copper production, 231,000 ounces of gold and 1,164,000 ounces of silver on average over its life span with higher output early in the mine life. Similarly, the study indicated a $1.53 billion after-tax Net Present Value at an 8% discount rate and a 15.4% Internal Rate of Return at metal prices of $3.00 per pound copper, $1,500 per ounce gold, and $18 per ounce silver. At spot prices on November 12, 2020 ($US3.14/lb Cu, $US1883/oz Au, $US24.33/oz Ag) these numbers increase to $US2.3Bn After-Tax NPV8 and 18.5% IRR.
“We are extremely pleased with the results of the Feasibility Study at Josemaria which indicates that this is one of the very few readily developable copper-gold projects in the world today,” said Josemaria Resources President and CEO Adam Lundin. “I believe the study results will allow us to unlock various financing opportunities as we move toward construction.”
The company estimates that the project’s anticipated capital costs, which include engineering, procurement, construction, management, on- and off-site infrastructure and contingency, amount to approximately $3.09 billion, with a further $940 million in sustaining capital required to maintain operations at full production over the entire 19-year life span of the mine (https://ibn.fm/8svkR).
The feasibility study includes an optimised mine production plan with average grades in the initial three full years of production notably better than the life of mine averages, supporting strong investment payback potential and driving a 3.8-year payback period from start of production.
Following the release of the feasibility study, the Josemaria Project is expected to continue progressing rapidly towards construction. Basic engineering work is currently forecast to begin in the first quarter of 2021, followed by detailed engineering in the third quarter of 2021. The construction of a pioneering access road is planned to commence in the third quarter of 2021 predicated on appropriate permitting and financing milestones being met. Once all necessary conditions have been met, Josemaria Resources anticipates commencing the bulk earthworks on site during the fourth quarter of 2022. Commercial production is ultimately forecast to commence by 2026.
Once operational, the Josemaria Project is estimated to derive 71% of its revenues through the production of copper, with a further 27.5% contributed by gold and 1.5% from silver. Global demand for copper has shown a steady growth trajectory over the years- with the global copper market expected to achieve an annual value of $222.1 billion by the end of 2026. Gold, a traditional store of value and safe haven investment has seen its price appreciate significantly over the course of the year touching a high of $2,067.15 an ounce in early August 2020 (www.gold.org)
For more information, visit the company’s website at www.JosemariaResources.com.
NOTE TO INVESTORS: The latest news and updates relating to JOSMF are available in the company’s newsroom at https://ibn.fm/JOSMF
QualityStocks is committed to connecting subscribers with companies that have huge potential to succeed in the short and long-term future. It is part of our mission statement to help the investment community discover emerging companies that offer excellent growth potential. We offer several ways for investors to learn more about investing in these companies as well as find and evaluate them.