- Australia-focused gold miner Evolution Mining announced today that its Board has approved capital investment of A$250 million for the Mungari plant expansion from 2 million tonnes to 4.2 million tonnes per annum following completion of the feasibility study.
The company said that the feasibility study demonstrated a “compelling investment case” with an IRR ranging from 19% to 28% with a three-year payback and incremental NPV of A$260 million to A$600 million, at a conservative A$2,400/oz and spot price of A$2,965/oz respectively, a mine life of approximately 15 years to 2038 and an 18% reduction in AISC to A$1,750 per ounce .
Commenting on the approval, Evolution’s Managing Director and CEO, Lawrie Conway stated, “Mungari has demonstrated its capacity to consistently and reliably deliver approximately 135,000 ounces per annum in recent years. This plant expansion unlocks the very large regional resource base, reduces all-in sustaining costs by 18% to $1,750 per ounce, extends the mine life out to 15 years, and grows production to over 200,000 ounces post commissioning.
Importantly, the company said there is a “significant potential” for further discovery in this world-renowned greenstone gold terrain with Mungari’s"strong project pipeline" to increase the resource base beyond 5 million ounces. The focus over the next few years will be on discovering sufficient material to maintain production at 200,000 ounces per annum for the entire mine life.
Evolution operates five wholly-owned mines – Cowal in New South Wales, Ernest Henry and Mt Rawdon in Queensland, Mungari in Western Australia, and Red Lake in Ontario, Canada. Financial year 2024 gold production outlook is 770,000 ounces at an all-in sustaining cost of A$1,370 per ounce .