Capricorn Metals Announces Significant Increase in Mt Gibson Gold Reserves
CMM (CMM) Share Update November 2024 Thursday 14th
Capricorn Metals Increases Mt Gibson Gold Reserve by 41%
Capricorn Metals (ASX: CMM) has announced a substantial increase in the ore reserves of its Mt Gibson Gold Project, marking a transformative step for the company.
Instant Summary:
- Mt Gibson Gold Project reserves increased by 758,000 ounces, a 41% rise.
- Updated Ore Reserve Estimate: 89.8 million tonnes at 0.9g/t Au for 2.59 million ounces.
- Capricorn's total gold reserves now exceed 4.0 million ounces.
- Expected production of 150,000 ounces annually for the first 15 years.
- Life-of-mine free cash flow forecasted at A$3.2 billion.
Reserve Increase Details
Capricorn Metals has reported a significant update to its Mt Gibson Gold Project, with reserves now estimated at 2.59 million ounces, representing a 41% increase from previous figures. This update follows extensive drilling and a reassessment of the project's potential.
The updated Ore Reserve Estimate is based on 89.8 million tonnes of ore at a grade of 0.9 grams per tonne of gold. The increase in reserves is attributed to ongoing drilling efforts and favorable geological assessments, which have expanded the project's scope.
Economic Implications
The updated reserves position Capricorn Metals as a major player in the Australian mid-tier gold sector. The company projects an annual production of 150,000 ounces for the first 15 years of the mine's life, with an all-in sustaining cost (AISC) averaging A$1,650 to A$1,750 per ounce.
Financial forecasts for the project are promising, with a life-of-mine revenue of A$7.76 billion and free cash flow of A$3.2 billion. The project is expected to have a rapid payback period of 2.3 years, supported by a post-capex, pre-tax NPV5 of A$1,948 million.
Strategic Developments
Capricorn Metals is advancing project design and permitting processes to expedite development. The company is focused on completing the necessary environmental assessments and securing regulatory approvals to ensure a timely project commencement.
The increase in reserves at the Mt Gibson Gold Project is a positive development for Capricorn Metals, enhancing its production capacity and financial outlook. This announcement is likely to bolster investor confidence and could lead to a positive reaction in the company's stock price, reflecting the project's enhanced value.
Investor Reaction:
Analysts are expected to view the reserve increase favorably, noting the potential for Capricorn Metals to strengthen its position in the gold mining sector. The project's robust financial metrics and strategic importance are likely to attract investor interest.
Conclusion:
Capricorn Metals' significant reserve increase at Mt Gibson positions the company for long-term growth and profitability. Investors should consider the potential impact on their portfolios and stay informed about further developments as the project progresses.