The project will produce about 156,000 ounces of gold and 19.6 million pounds of copper per year for 195,000oz/y gold equivalent for 13 years at an estimated all-in sustaining cost of US$334 per ounce on a by-product basis and $595/oz on a co-product basis.
The project would yield an after-tax net present value of $1.05 billion at a 5% discount rate, an internal rate of return of 36% and a two-year payback following an initial capital cost of $309 million based on metal price assumptions of $1,599/oz gold and $3.19/lb copper.
Hod Madden hosts proven and probable reserves of 2.45 million ounces of gold and 287 million pounds of copper at an average head grade of 8.8 grams per tonne of gold and 1.5% copper, or 11.1g/t gold equivalent.
"When we purchased the stake in Hod Maden back in 2017, we knew that it would be a major growth catalyst for Sandstorm, and the positive results of this study spell out just how transformational it will be once in production. Along with the granting of the Environmental Impact Assessment that was previously announced, the Feasibility Study launches Hod Maden into the next stage of development," said Sandstorm Gold president and CEO Nolan Watson.
The underground mine will be divided into two distinct zones with a modified drift and fill technique applied to the upper area and long hole stoping applied to the lower mine area. The bulk of the mineralisation is located in the lower mine area, which will be accessed through a single portal. The upper mine will be accessed through two shallow shafts.
Ore processing contemplates a single stage crush, milling, a bulk flotation concentrate, regrind through a secondary milling and a secondary flotation, ultimately producing a saleable copper concentrate and a saleable pyrite concentrate.
Hod Madden's operator, Lidya Madencilik Sanayi ve Ticaret has commenced the application process for a forestry permit having received the final approval of the environmental impact assessment from the Ministry of Environment, Urbanization and Climate Change of Turkey in November. Production is currently expected in the second half of 2024.
Shares in Sandstorm Gold are trading C$8.06, valuing the company at $1.5 billion.