Preliminary Economic Assessment of Northern Freegold's Nucleus and Revenue
posted on
Feb 20, 2013 10:22AM
http://www.marketwire.com/press-release/preliminary-economic-assessment-northern-freegolds-nucleus-revenue-deposits-generates-tsx-venture-nfr-1759109.htm
February 20, 2013 10:12 ET
VANCOUVER, BRITISH COLUMBIA--(Marketwire - Feb. 20, 2013) - Northern Freegold Resources Ltd. (TSX VENTURE:NFR)(OTCQX:NFRGF)(FRANKFURT:8N6) is pleased to announce results of a NI 43-101 compliant Preliminary Economic Assessment ("PEA") for the Nucleus and Revenue deposits at the road accessible Freegold Mountain Project, in the Yukon, Canada. The project is 100% owned by Northern Freegold (the "Company").
The PEA was prepared by GeoVector Management Inc. The PEA was prepared as an open pit mining project. The project expects to yield a pre-tax net present value of $614.8 million and an internal rate of return ("IRR") of 23.4% at a 5% discount rate using three year trailing average prices of US $1455 per ounce gold, $3.65 per pound copper, $14 per pound molybdenum1, and $27.55 per ounce silver respectively. At recent prevailing spot commodity prices the pre-tax NPV (5%) and IRR increase to $779.6 million and 29.7% respectively. The results of the PEA demonstrate the potential technical and economic viability of a new gold with copper and molybdenum mine on the property. All $ are Canadian except where indicated.
Highlights:
The PEA is considered by Northern Freegold as the current optimized development scenario for the Freegold Mountain project based on the existing resources at Nucleus and Revenue. Both the Nucleus and Revenue deposits remain open as to depth and width providing future potential to significantly increase the size of the resource. Exploration data on the property clearly indicates that substantial potential exists for scaling up the project economics, and this upside includes:
"This is a key milestone for Northern Freegold," said John Burges, President & CEO, "this PEA demonstrates robust economics. The phased development with initial production at the Nucleus gold deposit helps to reduce upfront capital. Over 62% of the revenues are from gold production at an operating cost of less than $400 per ounce after byproduct credits. We have successfully grown the Nucleus/Revenue gold resource over 300% over the last four years and on a gold equivalent basis over 700%. Our exploration/drilling discovery costs for the 2012 inaugural Revenue resource were low at ~ $3 per gold ounce and $1 per gold equivalent ounce. There remain significant opportunities to grow the resources adjacent to the conceptual pits and extend the mine life, and there are many other high priority targets on the 10 km geophysical anomaly which have the potential to develop into near surface higher grade deposits."