Austral Gold has completed the technical report on the Guanaco and Amancaya projects in Region II, Chile.
According to Austral, the findings of the report complement its previously conducted pre-feasibility study.
Under the life of mine (LoM) plan, the Guanaco Project has produced around 50,000oz of gold per annum for the last four years and is expected to continue at this rate for the next five years.
Austral Gold CEO Stabro Kasaneva said: “This is a significant step for Austral Gold in executing on its focus on high-margin production growth.
“Once the new processing plant enters operation, the company plans to transport the high-grade Amancaya production, currently being stockpiled at Amancaya, to the new plant.
“We hope to see the efficiencies of the new plant positively impact our cash-flow, with gold recoveries expected to improve by at least 25%.“
Austral completed the purchase of the Amancaya project in 2014. After conducting an infill drilling programme last year, it has been assessing the possibility to run both Guanaco and Amancaya as a combined operation.
In addition, the company planned to treat complete production from the projects at a new processing plant built at Guanaco.
The company intends to complete final commissioning of the new plant shortly, with combined operations beginning after this.
The technical report determined an after-tax net present value of $71.3m at a 5% discount rate, a mine-life of five years, as well as a combined average annual production of around 53,000oz of gold, and 370,000oz of silver.