Beadell Resources has completed a feasibility study on a plant upgrade project at its 100%-owned Tucano gold mine in Amapa state in northern Brazil.
Conducted by Australia-based Harrier Project Management, the study will help in upgrading the plant with the addition of a 6MW ball mill, a high-rate thickener, another leach tank and an oxygen sparging system.
The viability of upgrading the Tucano process plant with an incremental estimated post-tax net present value (NPV) of $127m at a 5% discount rate and an estimated internal rate of return (IRR) of 138% was reflected in the study.
The pre-production capital cost of the project is expected to be $27.6m.
The company has reported that following positive outcome of the feasibility study, the plant upgrade initiative has been approved by the board of directors.
Set to start shortly, the project will be commissioned in mid-next year.
Beadell Resources CEO and managing director Simon Jackson said: "The feasibility study results show that the plant upgrades will add significant value to the Tucano project.
“Once complete, we look forward to the mine being fully optimised for the first time with resultant consistency of production and cashflows.
“As we continue to add mine-life through our successful exploration programmes, the mill upgrades are the foundation of the future for Beadell.”
Upon completion, the project will allow the company to process any mix of sulphide/oxide mill feed, allowing the mine to be fully optimised.
In addition, the company expects a more steady gold production profile and increased free cashflow as a result of the project.
While the throughput will be maintained at 3.6 million tonnes per annum, recoveries are forecast to increase to 93% from the current budgeted recovery of 88%.