08:53 AM EDT, 04/25/2024 (MT Newswires) -- Newcore Gold Ltd. ( NCAUF ) reported Thursday what it termed "positive" results of an independent, updated preliminary economic assessment (PEA) for the Enchi gold project in Ghana.

Highlights of the PEA cited an after-tax net present value of US$371 million based on a 5% discount rate, with a 58% internal rate of return at a gold price of US$1,850 per ounce. Initial capital costs were estimated at US$106 million (including a 20% contingency), with the payback period projected at 1.6 years.

Thursday's statement cited average annual gold production of 121,839 ounces; peak gold production in year six of 155,188 ounces; and 1.1 million ounces gold recovered over a 9-year life of mine.

Luke Alexander, President and CEO, in the statement said: "The PEA confirms the opportunity at Enchi to develop an open pit, heap leach operation with robust economics. This is a notable milestone and an important step in advancing the development of our Enchi Gold Project in Ghana towards a construction decision. The PEA is a culmination of several years of de-risking work that included an updated Mineral Resource Estimate completed in 2023 and significant metallurgical testwork on the Project. Having Lycopodium on-board as the lead consultant also continues to support the development of Enchi as they are a partner of choice given their strong operational experience in West Africa. Our emphasis moving forward is to continue to drive development of the Project towards production, while not losing focus on the district scale exploration opportunity that will drive the size and scale opportunity at Enchi longer-term. The economics within the PEA support advancing Enchi towards production while also providing a strong underpinning of value for Newcore as we look to continue to unlock the Project's significant potential."

Greg Smith, VP Exploration, added, "We believe that longer-term the Project economics will benefit from the sizeable upside potential that exists at Enchi, with future resource expansion probable within not only the near-surface oxide and transition mineralization but also within the higher-grade structures defined at depth. The Project has substantial untapped potential, with a strategic location along a gold belt that hosts sizable mining operations. Enchi's geological footprints align with those neighboring gold mines, with Newcore only just starting to define the potential of the Project that is reminiscent of its neighbors that began small and grew significantly over time. We look forward to continuing to prove out this potential for size and scale with an exploration focus alongside driving development of the Project going forward. As we advance Enchi with additional studies towards production, we will continue to prioritize working with our local communities to provide positive impacts, creating value for all stakeholders as we unlock the significant value potential at our Enchi Gold Project in Ghana."

The company's shares gained 2.6% to $0.1950 per share yesterday.