Meanwhile, Dundee’s subsidiary Dundee Resources has agreed to convert its 20% stake in Borborema into a 1.5% net smelter royalty (NSR) for the first 1.5 million ounces (moz) and 1% on the next 500,000oz of gold sold.
After reaching a threshold of 2moz, the royalty will be terminated.
Aura Minerals has completed a feasibility study on the Borborema project and plans to begin full construction at the mine with a $188m investment.
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The initial operating life of the mine is 11.3 years while the weighted average annual gold production at the mine is estimated at 65koz, based on the mineral reserves estimate.
In the first three years of production, the weighted average annual production is expected to be 83koz.
The feasibility study has estimated the probable reserves of the mine at 812,000oz while the indicated and inferred reserves at the mine are 2,077koz and 393koz, respectively.
This mine has the potential to convert 1,265koz of indicated mineral resources.
The company expects to begin open-pit stripping in the second quarter of next year and the construction could be completed by the first quarter of 2025.
First gold pour is targeted in the second quarter of the same year, followed by commercial production in the third quarter.
Aura Minerals president and CEO Rodrigo Barbosa said: “Borborema is expected to contribute significantly to our overall production profile, and we are delighted to announce this highly accretive feasibility study.
“Our optimism extends beyond the current findings, as a potential additional 1.265moz are expected to be converted to reserves following the completion of a 5.3km road relocation besides new resources that should be added in the future once ore body remains opened along strike and down dip.
“Furthermore, Borborema is poised to set new benchmarks with its important contributions to ESG standards by using treated greywater from the local community, utilising renewable energy sources, and relying on a robust local labour force.”
Located in the southern part of Rio Grande do Norte, Brazil, the mine is situated 26km from the town of Currais Novos.