Orla Mining has reported results from a positive feasibility study of its 100% owned Camino Rojo oxide gold project in Zacatecas state, Mexico. The study supports development of an open-pit mine and heap-leach operation producing about 97,000 ounces per year (oz/y) of gold and 511,000 oz/y of silver in doré metal. Orla is now targeting a project construction start in the first half of 2020.

The Camino Rojo feasibility study considers mining of 44 million metric tons (mt) of oxide and transitional ore at a throughput rate of 18,000 mt/d. Ore from the pit will be crushed to 80% passing 28 mm, conveyor stacked on to a heap-leach pad, and leached using a low-concentration sodium cyanide solution. Pregnant solution from the heap leach will be processed through a Merrill-Crowe recovery plant.

The site’s proximity to infrastructure, low stripping ratio, compact footprint, and flat pad location all contribute to project simplicity and a relatively low estimated all-in sustaining cost of $576/oz of gold. Initial capital expenditures to develop the project are estimated at $123 million.

The proven and probable ore reserves at Camino Rojo are estimated at 44 million mt at grades of 0.73 grams (g)/mt gold and 14.2 g/mt silver, containing 1.03 million oz of gold and 20.1 million oz of silver. Predicted average gold recoveries of 64% are based on results from 85 column tests.

The Camino Rojo project site is located 3 kilometers (km) from a paved four-lane highway and approximately 190 km northeast of the city of Zacatecas. The area is flat, and there are no known social or environmental impediments to mining. Orla has all surface, mineral, and water rights to develop the project as presented in the feasibility study, and existing wells produce more than the average 24 liters/second of water required for the project.

The feasibility study mine plan was developed entirely on Orla’s mineral concessions and constrained by the property boundary. An agreement with the owner of the concession bordering Orla’s to the north would allow for the open pit to extend on to the adjacent concession. Such an agreement would result in an expanded pit with access to additional oxide and transitional material deeper into the pit, which would add to the mine life and/or annual throughput with only modest equipment and infrastructure additions. Orla remains optimistic that an agreement can be reached with the owner of the adjacent concession.