High-Grade Gold Discovery with Large Defined Footprint
| Location | Serbia |
| Ownership | 100% |
| Stage | Pre-feasibility study |
Čoka Rakita Project, Serbia
High-Grade Gold Discovery with Large Defined Footprint
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The Čoka Rakita project is located three kilometres southeast of the DPM’s Timok gold project and is 100% owned by DPM. In January 2023, DPM announced the discovery of a high-grade deposit at Čoka Rakita, and commenced an aggressive infill, extensional and target delineation drilling program at the prospect. In December 2023, DPM declared a maiden Inferred Mineral Resource estimate for Čoka Rakita of 1.8 million ounces of gold, and completed a preliminary economic assessment (PEA) for the project in April 2024.
Based on the robust project economics as outlined in the PEA, DPM will continue to accelerate the project and is advancing to a pre-feasibility study, which is targeted for completion in the first quarter of 2025.
Highlights
Čoka Rakita benefits from good established infrastructure, including power and road access to site. The project is located in close regional proximity to DPM’s existing operations in Bulgaria, and is a strong fit with our underground mining and processing expertise, with metallurgical test work demonstrating gold recoveries of approximately 90% by gravity concentration and conventional flotation.
The results of the PEA released in May 2024 confirm Čoka Rakita as a robust project with potential to add strong economic returns and high margin gold production to DPM’s portfolio.
| Čoka Rakita project PEA highlights (Based on a $1,700 per ounce gold price) |
|
|---|---|
| Throughput capacity | 850,000 tonnes per annum |
| Average annual gold production (life of mine) | 129,000 ounces of gold |
| Average annual gold production (first five full years) | 164,000 ounces of gold |
| Average cash cost1 (life of mine) | $605 per ounce of gold |
| Average all-in sustaining cost1 (life of mine) | $715 per ounce of gold |
| Initial capital expenditures | $381 million |
| Free cash flow1 (life of mine) | $891 million |
| NPV (after-tax, 5% discount)2 | $588 million |
| IRR (after tax)2 | 33% |
1Cash cost per ounce of gold sold, all-in sustaining cost per ounce of gold sold and free cash flow are non-GAAP financial measures or ratios and have no standardized meaning under IFRS Accounting Standards (“IFRS”) and may not be comparable to similar measures used by other issuers. As the Čoka Rakita project is not in production, the Company does not have historical non-GAAP financial measures nor historical comparable measures under IFRS, and therefore the foregoing prospective non-GAAP financial measures or ratios may not be reconciled to the nearest comparable measures under IFRS. Refer to the “Non-GAAP Financial Measures” section on page 10 of this news release for more information, including a detailed description of each of these measures.
2Current legislation in Serbia allows for tax relief for large investments for a maximum period of 10 years, subject to certain conditions. The PEA assumes that the Čoka Rakita project is eligible for this tax relief and the effective income tax rate applied is 0% over the project’s 10-year mine life.
Next Steps
In parallel to its exploration and infill drilling activities, DPM is advancing various activities to accelerate the project development timeline, including geotechnical and hydrogeological drilling programs, further metallurgical variability and optimization testwork, as well as several mining, processing and engineering trade-off studies. All of these activities will form the basis of the PFS, which has been initiated by DPM and is expected to be completed by the first quarter of 2025.
Planning for the project will be focused on ensuring responsible environmental management and social development in-line with industry best practices. DPM is committed to working closely with local communities around the Čoka Rakita project to understand and support local development opportunities, with a focus on maximizing benefits of the project for Serbia.
Permitting preparation activities are underway with a detailed timeline in order to support commencement of construction in mid-2026, with good support and engagement from key regional and national authorities. The Company has initiated preparations related to the environmental impact assessment (“EIA”), including monitoring for baseline studies related to surface water, ground water, air quality and biodiversity, and plans to initiate soil monitoring and a social study over the course of 2024.
Permitting and Stakeholder Engagement
Consistent with its approach across all operations and projects, DPM seeks to build and maintain strong partnerships with local communities and governments. We have had a local presence in Serbia since 2004 and developed strong relationships in the region, and we will continue to proactively engage with all stakeholders as the project advances.
Planning for the project will be focused on ensuring responsible environmental management and social development in-line with industry best practices. DPM is committed to working closely with local communities around the Čoka Rakita project to understand and support local development opportunities, with a focus on maximizing benefits of the project for Serbia.
Permitting preparation activities are underway with a detailed timeline in order to support commencement of construction in mid-2026, with good support and engagement from key regional and national authorities. The Company has initiated preparations related to the environmental impact assessment (EIA), including monitoring for baseline studies related to surface water, ground water, air quality and biodiversity, and plans to initiate soil monitoring and a social study over the course of 2024. The EIA is expected to be submitted in the first quarter of 2026.
