Black Cat Syndicate, an ASX-listed mining company, has released the results of a scoping study on its Coyote gold project in Western Australia. The study found that the project has the potential to produce approximately 200,000 ounces of gold per year over a mine life of five years.
According to the study, the Coyote project is expected to recover an average of 44,000 ounces of gold per year, with peak production reaching around 55,000 ounces per year in years three and four. The study also estimated that the project would require a pre-production capital investment of approximately A$80 million and have all-in sustaining costs of around A$1,586 per ounce, which is relatively low compared to other Australian gold producers.
The study further projected that the Coyote project could generate revenues of approximately A$565 million and have an internal rate of return of around 60% at a gold price of A$2,900 per ounce.
Black Cat Syndicate believes that the capital requirements for the Coyote project can be funded through cashflow generated at its Paulsens operation. The company stated that both Paulsens and Coyote have established infrastructure, allowing for a low-risk restart with a short timeframe to recommence operations. The Coyote project, in particular, has shown promising results with a five-year mine life and a processing rate 25% higher than previous operations.
The scoping study identified additional mineralization outside the current Coyote central resource, which will be targeted in future drill programs. Moreover, increasing the processing capacity of the carbon-in-leach (CIL) circuit could expedite cashflow from stockpiles generated in the early years of mining. Black Cat Syndicate plans to conduct further studies to optimize the processing facility design and mining schedules, with the aim of sustaining and increasing processing rates.
Gareth Solly, Managing Director of Black Cat Syndicate, stated that the positive results of this scoping study will lead to additional targeted drilling and a more detailed restart study. Solly emphasized that the company’s intention is to fund future development of Coyote and potentially Kal East with cashflow generated from Paulsens.
In addition to the Coyote project, Black Cat Syndicate recently released a re-start study for the Paulsens operation. The study estimated a capital investment of A$34.3 million to bring the project back into production, targeting the recovery of approximately 42,000 ounces of gold per year over an initial three-year period.
The findings of both studies highlight the potential for significant gold production and cashflow generation for Black Cat Syndicate. With promising results at both the Coyote and Paulsens projects, the company is well-positioned to capitalize on the robust gold market and make valuable contributions to Australia’s mining industry.
