Costs decrease at Vista Gold’s Paredones Amerillos

Vista Gold (VGZ-T, VGZ-N) has updated certain parts of a 2008 feasibility study for its Paredones Amerillos gold project in Baja California Sur, Mexico, resulting in some moderate improvements.

The company hired an engineering and construction firm to review the process facility design to optimize the process area layout.

Roberts & Shaefer Company confirmed the proposed production parameters and constructability – an 11,000 tonne-per-day open pit mine that would produce an average 127,400 oz. gold per year over 9.4 years.

Capital and operating costs were also reviewed and some changes have been made.

Pre-production capital costs are US$7.4 million lower at US$189.8 million.

The average life-of mine cash costs were US$15 per oz. lower at US$406. per oz. and the average cash cost for the first five years was about US$8 per oz. lower at US$372 per oz.

And thus, the after-tax internal rate of return increased by 3% to 19.6% using a gold price of US$850 per oz. for the first three years and US$725 per oz. thereafter.

Vista also looked at what kind of results it would have with a US$950 per oz. gold price. In that case the after-tax IRR was 31%.

Vista is now working on a 13-hole confirmatory drill program at Paredones Amearillos.

The company is still in the process of getting a mining permit and has started a community engagement program in anticipation of receiving the permits.

The project has measured and indicated resources of 71 million tonnes grading 0.93 gram gold per tonne for 2.1 million oz. Economic reserves total 38 million tonnes grading 1.08 grams gold per tonne for 1.3 million oz.

The company is also working on a prefeasibility study for the Batman deposit at its Mt. Todd gold project in Australia’s Northern Territory. The deposit has measured and indicated resources of 191 million tonnes grading 0.84 gram gold for a total of 5.1 million oz. gold while inferred resources stand at 94 million tonnes grading 0.74 gram gold for 2.2 million oz. gold.

 Vista shares were up 7¢ today to $2.63 per share on a trading volume of 54,000 shares.