In a news release, Generation Mining Ltd. (GENM:TSX; GENMF:OTCQB; 9GN:FSE) announced the results of a feasibility study on its Marathon asset in Ontario, Canada.
"This study confirms that the Marathon palladium and copper project is a substantial mining project that is expected to provide a very robust return on investment," President and CEO Jamie Levy said in the release.
Those favorable economics are an after-tax internal rate of return (IRR) of 29.7% and a net present value at a 6% discount (NPV6%) of CA$1.07 billion. These figures are based on long-term metals prices of US$1,725 per ounce for palladium and US$3.20 per pound for copper. Payback would be quick in 2.3 years.
When using current spot metal prices (US$2,395 per ounce for palladium and US$3.99 a pound for copper), the study shows an after-tax IRR of 47%, an NPV6% of CA$2.02 billion and a payback period of 1.5 years.
Costs also were projected to be attractive. Initial capex would be low, at CA$665 million net of equipment financing. Average life-of-mine cash costs are an estimated US$687 per palladium equivalent ounce (Pd eq oz). All-in sustaining costs are calculated at US$809 per Pd eq oz.
The study forecasts quantities of payable metals at 1,900,00 ounces of palladium and 467,000,000 pounds of copper, along with 537,000 ounces of platinum, 151,000 ounces of gold and 2,800,000 ounces of silver.
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