Riverstone Announces Preliminary Economic Assessment Results on Flagship Karma Gold Project; After-Tax NPV of $192 Million and IRR of 37%
Riverstone Resources Inc. (TSX-V; RVS) ("Riverstone" or the "Company") is pleased to report the results of a NI 43-101 compliant Preliminary Economic Assessment (the "PEA") carried out on the Company's flagship Karma Gold Project in Burkina Faso, West Africa (the "Karma Project"). All currency figures are in $US and based on a $1,350/oz gold price (May 2012 three year trailing average).
•Pre-tax NPV $271 M, IRR 47%.
•After-tax NPV $192 M; IRR 37%; payback is 2 years; including the Burkina Faso Government 10% carried interest.
•Open pit heap leach operation processing 3 Mtpa (million tonnes per annum) of oxide and transition mineralization to produce 70,000 to 90,000 oz of gold annually over a 10 year mine life and cash costs of $525/oz gold.
•Initial start-up capital is $125 M, with a potential to reduce to $96 M utilizing contract mining.
•The PEA is based on the January 1, 2012 NI 43-101 Global Mineral Inventory and optimized In-Pit resources.
•In excess of 85,000 metres of drilling has been completed subsequent to the data cut-off date for the January 2012 resource estimation, which, have not been included in this PEA.
"We are very pleased with the robust results of this PEA which illustrate the potential economic viability of a mining operation for our flagship project. The strong economics demonstrated by the PEA support the company's strategic plan to develop a stand-alone heap leach operation and subsequently exploit the sulphide resource potential using the cash flow from the heap leach operations", commented Dwayne L. Melrose, President and CEO of Riverstone. "This is a significant milestone for the Company that will further guide the future development of the Karma Project to the feasibility stage. The additional 85,000 metres of drilling that have been completed since the last resource estimation have produced favourable results and is expected to further enhance the economics of the Karma Project. An important aspect of the Karma Project is the encouraging potential for further resource expansion as the mineralization is still open in at least one or more directions. Additionally, there is still excellent upside exploration potential throughout all the other properties owned and directed by the Company within Burkina Faso to discover new deposits." -- Riverstone Resources press continues at the link below.
Source: Riverstone Resources
Disclosure: Riverstone Resources is a Vulture Bargain Candidate of Interest (VBCI) and is our fully fledged Vulture Bargain #3. Members of the GGR team are actively accumulating shares of RVS.V or RVREF and continue to hold a speculative long position in the company.