Midtier By 2016
Rainy River CEO Raymond Threlkeld Discusses the RRGP PEA
Kevin Michael Grace
Rainy River Resources Ltd T.RR announced August 30 an updated preliminary economic assessment of its 100% owned Rainy River Gold Project (RRGP) in southwest Ontario. The PEA forecasts a 16-year mine life, with average annual production of 308,000 gold ounces and 478,000 silver ounces for the first 10 years at a cost of US$486 per ounce, an average head grade of 1.45 grams per tonne gold, an operating strip ratio of 2.5:1 and an average throughput of 20,000 tonnes per day. Based on US$1,250 per ounce gold and US$25 per ounce silver, the pretax net present value (NPV) is $846 million (at a 5% discount rate), the internal rate of return (IRR) is 21%, with a 3.8-years payback. The initial preproduction CAPEX is $694 million (including a $100-million contingency), and the open-pit sustaining CAPEX is $340 million.
RRGP comprises16,530 hectares located 65 kilometres northwest of Fort Frances, near the Minnesota border. According to a February 24 43-101 resource estimate, it contains 5.72 million ounces gold and 12 million ounces silver measured and indicated and 2.25 million ounces gold and 6.77 million ounces silver inferred.
President/CEO Raymond Threlkeld spoke to Kevin Michael Grace October 1; read the interview here.