The company has filed a prefeasibility study that considers an independent and phased openpit operation at Pumpkin Hollow, which it says will be value accretive for shareholders.
Nevada Copper said the pre-tax IRR increased to 23%, compared with the September 2018 PEA result of an IRR of 21%. The PFS also calculated an NPV, using a 7.5% discount, of US$1.04 billion, below the PEA NPV of $1.17 billion.
Initially, the openpit will operate at a mining rate of 37,000t/d, later increasing to 70,000t/d, which substantially lowers upfront capital costs, compared with historic studies.
The openpit's pre-production capex of $672 million in the PFS, compared with the PEA estimate of $592 million, gives the project a capital intensity of $9,544/t of copper equivalent.
"We are very pleased with the new PFS for our openpit project at Pumpkin Hollow. The results clearly illustrate the potential to put this large, openpit project into production with a further improved internal rate of return and continued low capital and operating costs," CEO Matt Gili said.
Peak copper production is forecast to be 111,000t/y, or 244Mlb/y. In the first five years of its 19-year mine life, the Pumpkin Hollow openpit is predicted to achieve copper-equivalent grades of 0.69%.
"The study's focus of generating project value through an improved internal rate of return has resulted in a higher-grade driven mine plan. This means we expect the openpit project to be more robust with regards to lower copper prices, while also affording potential flexibility for mining more of the mineral resource under differing market conditions," said Gili.
The 2018 drilling programme on which the openpit PFS was based extended openpit mineralisation while highlighting a need for further drilling to test the full extent of the deposit and continue expanding openpit resources.
The Pumpkin Hollow underground mine was on track to start production in the fourth quarter, Gili said.
The 5,000t/d underground project will produce 60Mlb a yearn of copper in the first five years, as well as 9,000ozpa gold and 173,000ozpa silver. Over the entire 13.5-year mine life, annual output will average 50Mlb copper, 8,000oz gold and 150,000oz silver.
Nevada Copper (TSX:NCU) is currently trading about 38.5% below its value a year ago at C40c, which capitalises the company at $264.77 million.