Generation Mining Ltd. (GENM:CSE; GENMF:OTCQB) announced in a news release the results of a preliminary economic assessment (PEA) of its 51%-owned Marathon palladium-copper project in northern Ontario.
"The PEA provides a compelling base case assessment for the development of the Marathon palladium mineral resource by open-pit mining," the release noted.
The report, prepared by P&E Mining Consultants, outlines a mine that would produce an average of 194,000 palladium equivalent ounces per year over a 14-year life, including credits for copper, platinum, gold and silver. Production of palladium alone is forecast to average 107,000 ounces over the mine life, at a $US504 per ounce cash cost and a US$586 per ounce all-in sustaining cost, net of byproduct credits.
In the base case scenario, the project is calculated to yield an estimated 30% after-tax internal rate of return and a CA$871 million after-tax net present value at a 5% discount rate. After-tax cash flows are projected to amount to CA$520 million in the first three years, with achievement of payback at 2.5 years.
Of the three known deposits on the property, only Marathon was included in the PEA. Further, the report only included the Measured and Indicated mineral resources at Marathon.
"With the consensus outlook for palladium and copper strong for the next several years, this is a project whose time has come," Generation Mining Executive Chairman Kerry Knoll said in the release.
As such, the explorer stated it intends to fast-track a feasibility study and permitting for Marathon.
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