Aura Minerals Expands Borborema Gold Reserves by 82% After Road Relocation Deal

Event summary

  • Aura Minerals signed an agreement with DNIT to relocate a federal road at the Borborema mine, unlocking an additional 670 Koz of gold in mineral reserves, totaling 1.5 Moz.
  • The updated feasibility study includes probable reserves of 40.7Mt at 1.13g/t Au, containing approximately 1,479Koz of gold.
  • The project's net present value (NPV) increased to US$612.5 million, with an after-tax IRR of 42.8% based on a weighted average gold price of USD 2,274/Oz.
  • The mine's life of mine (LOM) is estimated at 20 years and 5 months, with an average annual gold production of 65 Koz.
  • Aura plans to advance engineering and water-access solutions to increase capacity and progress the road relocation.

The big picture

Aura Minerals' strategic agreement to relocate the road at the Borborema mine significantly accelerates value creation by unlocking substantial additional gold reserves. This move aligns with the company's strategy of starting production quickly, generating positive cash flow, and then unlocking further upside. The updated feasibility study demonstrates robust project economics, positioning Aura to capitalize on higher gold prices and exploration potential.

What we're watching

Execution Risk
Whether Aura can sustain the pace of engineering and water-access solutions to increase capacity while progressing the road relocation.
Resource Potential
How additional drilling will extend the Mineral Resource’s footprint and add more contained ounces within the current envelope of mineralization.
Market Dynamics
The impact of higher gold prices on the review of the mine plan with new cut-off grades, which could further improve reserves.

Related topics

Mining