06:38 AM EDT, 09/05/2024 (MT Newswires) -- Alamos Gold ( AGI ) late on Wednesday reported results of the internal economic study on the Puerto Del Aire project in Mexico, which the company plans to begin developing next year with first production expected in mid-2027.

The project is expected to nearly triple the mine life of the Mulatos District, extending production into 2035, the company said.

The project's after-tax internal rate of return is 46% and after-tax net present value discounted at 5% is US$269 million.

Annual gold production is 127,000 ounces over the first four years and 104,000 ounces over the current mine life.

Total cash costs is US$921 per payable ounce and mine-site all-in sustaining costs is US$1,003 per payable ounce.

Total initial capital is projected at US$165 million and expected to be spent over a two-year period starting mid-2025. Of this total, US$51 million will be used for underground development and US$109 million will be used for the processing facility, which includes a 25% contingency.

The project will benefit from the use of existing crushing and mill infrastructure from Cerro Pelon and Island Gold, lowering development and permitting risk.

Alamos' share price at last look gained 2.1% to US$18.67 in U.S. pre-market trading on Thursday.