Orea buying out Montagne d’Or partner in French Guiana

The deposit contains measured and indicated resources of 3.85 million oz. of gold in 85.1 million tonnes grading 1.405 g/t gold. Within the M+I resources are proven and probable reserves of 2.75 million oz. in 54.1 million tonnes grading 1.58 g/t gold. There is also an inferred resource of 960,000 oz. in 20.2 million tonnes at 1.484 g/t gold.

Produced in 2017, the feasibility study gave Montagne d’Or an after-tax net present value (5% discount) of US$370 million and an internal rate of return of 18.7% using a gold price of US$1,200/oz. The initial capital cost was estimated at US$361 million with a payback period of 4.1 years, followed by sustaining capital of US$231 million and closure costs of US$61 million.

The project was expected to average 214,000 oz. per year over a 12-year mine life, but production over the first 10 years of the mine will average 237,000 oz. annually. All-in sustaining costs are US$779 per oz. of gold over the life of the mine, including closure and reclamation.

Under terms of the agreement with Nordgold, Orea will make no up-front payments. Orea will only be required to pay Nordgold C$100 million when all the mining permits and licences are received for construction of a mine with a minimum output of 100,000 oz. of gold per year. If Nordgold shareholders are still under sanctions at the time, payment will be made to a blocked bank account. The binding letter of agreement is subject to approval by regulatory agencies.

Orea maintains a large gallery of images from the Montagne d’Or project on its website, www.OreaMining.com.