CANADA — Generation Mining Limited (TSX:GENM) has announced significant optimisations to its Marathon Palladium-Copper Project in Northwestern Ontario, promising improved project economics and enhanced financial performance.
The company has successfully completed a comprehensive project optimisation work that focuses on two critical areas: mine plan sequencing and initial capital cost reduction.
The optimisation efforts have yielded impressive results, with the company projecting an additional 78,000 ounces of palladium, 34,000 ounces of platinum, and 2 million pounds of copper in the first three years of operations.
This strategic approach is estimated to generate approximately CA$190 million in additional payable revenues and operational cost benefits.
Jamie Levy, President and CEO, highlighted the project’s enhanced financeability, noting that the optimisation work represents a meaningful improvement despite ongoing industry-wide inflationary pressures.
The company has managed to reduce initial capital estimates by CA$89 million, achieving this through collaborative efforts with Ausenco Engineering Canada ULC.
Key improvements include deferring 36 million tonnes of waste stripping during the initial operational phase, which allows for a focus on higher-grade ore with a lower strip ratio.
The project now boasts an improved after-tax internal rate of return (IRR) of 26 per cent and a shortened payback period of 2.1 years.
The optimisation work involved detailed evaluations of pit sequencing, plant design, and equipment sizing.
By leveraging favourable site geotechnical conditions and minimising overburden, Generation Mining has refined the project’s technical and economic parameters.
The total initial capital expenditure is now estimated at CA$961 million, representing a significant reduction from previous projections.
The project demonstrates substantial sensitivity to palladium and copper prices, with the after-tax net present value (NPV) at a 6 per cent discount rate showing considerable potential across various price scenarios.
At the current palladium price of US$1,525 per ounce and copper price of US$4.00 per pound, the project presents a robust investment opportunity.
Generation Mining’s strategic optimisation of the Marathon Project underscores the company’s commitment to maximising resource potential and creating value for stakeholders in the challenging mining landscape.
