Prodigy Gold, a Canadian junior based in Vancouver, British Columbia, has announced results of an updated, NI 43-101 compliant preliminary economic assessment (PEA) of its 100%-owned Magino gold project in Ontario.

The PEA outlines an ambitious open-pit project that would produce an average of 249,300 oz/y of gold over an 11-year mine life. Year-one gold production is projected at about 350,000 oz at a mined grade of 1.57 g/mt gold. Pre-production capital costs are estimated at C$405.6 million. Payback period is estimated at 1.9 years.

The Magino mine property is a past-producing underground gold mine located 40 km northeast of Wawa, Ontario. The mine was operated by Muscocho Explorations from 1988 until the summer of 1992.

Open-pit mining for Prodigy’s Magino development is assumed to be undertaken by the owner, using leased equipment. The pit design, optimization and production schedule prepared by Tetra Tech calls for total mine production of 74.23 million mt, grading 1.15 g/mt gold. Total gold recovered over an 11-year project life is estimated at 2.61 million oz. The life-of-mine average strip ratio is estimated at less than 2.1 to 1.

The PEA contemplates a conventional carbon-in-pulp processing facility operating at 20,000 mt/d, with 95% availability. A gyratory crusher fed by direct dump from 200-mt trucks will be used as the primary crusher. Life-of-mine operating cash costs, excluding sustaining capital, are projected to average $461/oz (C$496/oz).

Brian J. Maher, president and CEO of Prodigy Gold said: “This PEA will serve as the template for a full feasibility study, expected to be completed in 2012. The results of the PEA validate our operational model for Magino, and the company looks forward to rapidly advancing the project in the coming year.”