On Sept. 8, O3 Mining released the results from an independent preliminary economic assessment (PEA) for its Marban project in Val-d’Or, Quebec.

According to the PEA led by Ausenco Engineering Canada, Marban would process 11,000 tonnes of ore per day over a 15.2-year mine life and exceed production of 130,000 ounces of gold per year over the first 12 years, with peak production of more than 161,000 ounces of gold in the mine’s ninth year at a gold price of US$1,450 per ounce.

The results also indicate an after-tax net present value of $423 million, an after-tax internal rate of return of 25.2 per cent and a payback period of four years. The project has an initial capital cost of $256 million and would have an all-in sustaining cost of US$822 per ounce of gold.

Related: Ivanhoe Mines releases integrated development plan outlining phased development of its joint mine complex in the Democratic Republic of Congo

The company believes that Marban has the geological potential to extend the mine life beyond the 15.2 years outlined in the PEA, and believes that ongoing exploration and drilling could increase the project’s mineral resource.

“Marban has shown potential to become a highly profitable gold mine in one of the most prolific producing regions in Canada,” said Jose Vizquerra, president, CEO and director of O3 Mining. “The Marban Geological team has demonstrated the ability to identify an abundance of gold resources over a very short period. The ongoing drill program will continue to add to and upgrade resources as we seek to move the project forward towards production.”

The Marban project is part of O3 Mining’s Malartic property in Quebec’s Abitibi region. The project area covers three past-producing mines which produced 585,000 ounces of gold between 1959 and 1992. The company will begin working on a pre-feasibility study and environmental impact studies and plans to continue drilling and exploration programs on the property.