Getchell Gold Corp. (CNSX: GTCH) (OTCMKTS: GGLDF) (FWB: GGA1) says a new preliminary economic assessment has outlined a potential USD$905 million after-tax project at its Fondaway Canyon gold project in Nevada, with the study projecting average annual production of 150,000 ounces over a 10-year mine life and a rapid 1.5-year payback.
Announced on Tuesday, the independent study evaluated only the Central Area of the company’s wholly owned Fondaway Canyon project. It envisions an open-pit mining operation feeding a conventional 12,000-tonne-per-day processing plant. Additionally, the assessment assumes the mine would produce a high-grade gold concentrate for shipment to a third-party refinery for final processing into doré bars.
Using a base-case gold price of USD$3,200 per ounce, the study estimated a pre-tax net present value discounted at eight per cent of about USD$1 billion. It also projected an after-tax net present value of USD$905 million and an after-tax internal rate of return of 53.1 per cent.
The assessment estimated initial capital costs at USD$265 million, including a 20 per cent contingency. Consequently, the project could recover those upfront costs in about 1.5 years before tax under the study assumptions.
The proposed operation would recover about 1.52 million ounces of gold over its planned life. Average annual production would reach roughly 150,000 ounces. Furthermore, the study estimated an average mined grade of 1.38 grams of gold per tonne and an overall recovery rate to saleable metal of 80 per cent.
Life-of-mine operating costs came in at an estimated USD$1,373 per ounce of produced gold. Cash costs, which include refining charges and royalties, were estimated at USD$1,740 per ounce.
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The assessment excluded underground resource beneath the main pit
The new assessment represents a significant improvement over the company’s 2025 preliminary economic assessment. Contained gold ounces and average annual production both increased by 28 per cent. Additionally, the project’s base-case net present value climbed by more than 60 per cent.
Getchell attributed much of that improvement to updated mineral resources, higher assumed gold prices and a simplified processing plan. The company also incorporated additional drilling completed since the earlier assessment and new metallurgical testing into the study.
An updated mineral resource estimate completed in April increased indicated mineral resources by 54 per cent compared with the 2024 estimate. Inferred resources also grew by eight per cent after the company added results from 10 new drill holes.
The study focused on only part of the property’s known mineralization. Specifically, it examined the Central Area open pit, which accounts for about 68 per cent of the currently defined global mineral resource at Fondaway Canyon.
However, the assessment excluded underground resources beneath the Main Pit. It also left out additional open-pit mineral resources elsewhere along the project’s seven-kilometre mineralized corridor.
Company president Mike Sieb said the assessment demonstrates the potential for a strong open-pit mining operation producing about 150,000 ounces of gold each year. He added that such output would likely place Fondaway Canyon among Nevada’s larger gold mines while leaving room for future growth through continued drilling.
Chairman Bob Bass described the study as supporting management’s expectations for the project. He also said the economics point to substantial potential value creation for shareholders as development advances.
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Engineers designed the mine around a series of nested pit shells
The proposed mine plan calls for contract mining rather than company-owned mining equipment. Ore would travel by truck from the open pit to the nearby processing facility. Meanwhile, the plant would process about 4.2 million tonnes of material annually.
Engineers designed the mine around a series of nested pit shells. That approach prioritizes the most economically valuable material while managing waste removal throughout the operation.
The selected pit shell contains approximately 339.1 million tonnes of material. Within that total, engineers identified 18.8 million tonnes of indicated mineral resources grading 1.46 grams of gold per tonne and 24.1 million tonnes of inferred resources grading 1.32 grams per tonne.
Together, those resources contain an estimated 1.9 million ounces of gold. That total marks a 28 per cent increase over the resource considered in the previous preliminary economic assessment.
The production schedule assumes the mill would process 12,000 tonnes each day. Additionally, the mine would operate with an average life-of-mine strip ratio of 6.9 tonnes of waste for every tonne of processed ore.
The company based the processing plan on conventional flotation rather than direct cyanide processing. Instead, the mill would separate gold-bearing sulphide minerals into a concentrate before shipping that material to an outside processing facility.
Metallurgical testing suggested the process could recover about 84 per cent of gold into concentrate. However, after refining losses, the overall recovery to sold metal falls to roughly 80 per cent.
Engineers recommended additional metallurgical work before advancing the project. Future studies would refine grind size, flotation performance and dry-stack tailings design while confirming projected costs.
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Operating costs over the mine’s life are estimated at USD$2.09B
The processing plant would use three stages of crushing followed by ball-mill grinding and flotation. Subsequently, gravity concentration would recover additional gold before the remaining tailings undergo filtration and dry stacking.
The study identified producing a gold-rich concentrate as the preferred option at this stage. According to the assessment, shipping concentrate to an existing Nevada processing facility reduced both capital requirements and operating costs compared with building a complete refining circuit on site.
Operating costs over the mine’s life totalled an estimated USD$2.09 billion. Cash costs reached approximately USD$2.65 billion after including treatment, refining, transportation and royalty expenses.
The study did not include sustaining capital because it assumes contract mining and a 10-year processing plant life. Instead, maintenance costs remain part of ongoing operating expenses.
The assessment remains preliminary and relies partly on inferred mineral resources, which carry greater geological uncertainty than indicated resources. Consequently, the study does not establish mineral reserves or guarantee the project’s economic viability.
SLR Consulting of Fort Collins, Colorado led preparation of the preliminary economic assessment under National Instrument 43-101 standards. Additionally, DM Consulting LLC handled metallurgical and process design work, while APEX Geoscience Ltd. prepared the updated mineral resource estimate. The study carries an effective date of June 1, 2026, and the company expects to file the full technical report on SEDAR within 45 days.
