43-101 2008 Technical Report On The La Fortuna Project, Durango ...
43-101 2008 Technical Report On The La Fortuna Project, Durango ...
43-101 2008 Technical Report On The La Fortuna Project, Durango ...
You also want an ePaper? Increase the reach of your titles
YUMPU automatically turns print PDFs into web optimized ePapers that Google loves.
16.2.2 Economic Evaluation<br />
<strong>The</strong> Base Case financial scenario at a conservative gold price of US$625 per ounce (Table 19) shows the<br />
El Castillo <strong>Project</strong> to be NPV positive and economically viable. At a gold price of US$625, the El<br />
Castillo project creates an after tax Net Cash Flow of US$95.0 million with a Net Present Value of $70.4<br />
million at a discount rate of 5%, $61.3 million at 7.5% and $53.8 million at 10% discount rate. <strong>The</strong><br />
breakeven (after tax) long term gold price is approximately US$ 370/oz Au. <strong>The</strong> breakeven price includes<br />
recovery of capital and operating costs. For comparison purposes, Table 20 summarizes the NPV<br />
differences at a 10% discount rate and variable gold prices between the 2006 Howe report and the current<br />
report (Table 21).<br />
Table 20. NPV differences at a 10% discount rate.<br />
Gold Price (US$) NPV (10%) % Difference with Howe<br />
<strong>2008</strong> US$625 Base Case<br />
Scenario<br />
450* 12,350,000* 335<br />
500* 19,065,000* 182<br />
550* 25,783,000* 108<br />
600* 32,500,000* 65<br />
* Data from Howe 2006 <strong>Report</strong> #897<br />
Table 21. Gold Price Chart (1995-<strong>2008</strong>)<br />
60