We revised the comminution circuit design and the site layout to reduce upfront construction and earthworks capital costs when progressing a gold and copper processing plant from PEA to PFS. PFS costs came in at, or below, previous PEA projections despite a strong inflationary market.
The Challenge
Lumina Gold’s Cangrejos project is a projected 80,000 t/d gold and copper mine and processing plant in El Oro, southwest Ecuador, 30 km southeast of the provincial capital of Machala. Previous PEA designs for the processing plant required a large volume of earthworks, with project costs exceeding client targets by nearly 40%.
Our challenge was to complete the PFS while holding to the earlier PEA cost estimates – or even reducing capital costs – despite an inflationary market.
The Better Way
Our layout team worked with our civil engineering team to rethink the earthworks proposed in the PEA.
The Outcome
We reduced initial capital by rethinking the phased expansion and reduced total CAPEX by eliminating additional equipment proposed for the final design. Our relocation reduced earthworks costs significantly, as well as allowing a switch to a gravity tailings line, eliminating pumping costs from operational expenses.
Our team improved project financials significantly over those of the PEA. Despite inflationary pressures, we maintained capital costs at just under $1 billion CAD. We added almost $700 million CAD to the Net Present Value (NPV5%) of the project and more than a percent to the Internal Rate of Return (IRR). These changes make the project attractive to future development.
In early 2024, we were awarded the Feasibility Study and with a deep understanding of the project, will continue to advance the project.