The study detailed the development of the Bermejal underground mine and new 4,000 tonne per day CIL plant at a capital cost of $180 million, yielding an after tax net present value of $565 million at a 5% discount rate and after tax internal rate of return of 87%.

The expansion will increase average annual production to 350,000oz of gold for 10 years at an all-in sustaining cost of US$759/oz from proven and probable mineral reserves of 111.3 million tonnes grading 1.23 grams a tonne containing 4.5Moz Au. The current Los Filos operation produced 195,362oz Au in 2018 at an AISC of around $1,000/oz.

"The study identifies a new operating strategy which includes three large open pits, two high-grade underground mines, the addition of a CIL plant to process the higher-grade ore, and the continued heap leaching of the lower-grade open pit ore," said CEO Neil Woodyer.

Leagold acquired Los Filos in April 2017 from Goldcorp and has since then carried out extensive exploration for both openpit and underground deposits, developed a 1,330m ramp to access the ore body at Bermejal underground, completed the Bermejal underground mine design, completed comprehensive metallurgical test work on all of the mineral deposits to support the CIL plant design, and learned a lot from current operations.

Its work investment to date is about $30 million.

The pre-commercial development phase for Bermejal underground extends to the third quarter of 2020.

The construction of the CIL plant will take 18 months, with commissioning and ramp-up to occur in the third quarter of 2020.

Expansion of openpit mining operations, with pre-stripping at Guadalupe and a pushback at Los Filos, is scheduled for 2020. The pushback to expand the Bermejal openpit is scheduled for 2021.