Alamos Gold reported it has been granted the GSM (Business Opening and Operation) permit required for the development of its Kirazlı project by the Çanakkale governorship in Turkey. “With the Environmental Impact Study and forestry permits having been previously approved, we have all the required permits to ramp up full-scale construction activities,” said John A. McCluskey, president and CEO, Alamos Gold. “As one of the lowest-cost and highest-return gold projects in the world, Kirazlı will be a significant driver of free cash flow growth with initial production expected in 2020.”
As outlined in the 2017 feasibility study, Kirazlı has a 44% after-tax internal rate of return and is expected to produce more than 100,000 ounces (oz) of gold during its first full year of production at mine-site all-in sustaining costs of less than $400/oz. This is expected to bring consolidated production to more than 600,000 oz/y, while significantly lowering the company’s cost profile.
Alamos will be mobilizing for full-scale construction activities over the next two months. The initial capital estimate for Kirazlı is $152 million of which $50 million to $60 million is expected to be spent in 2018, inclusive of $10 million spent through the first half of 2018. The bulk of the remaining initial capital will be spent in 2019 and the first half of 2020. Based on the current timelines, Alamos expects initial production from Kirazlı in the second half of 2020.