Dundee Precious Metals revealed that the Čoka Rakita gold project in Serbia will require an initial capital expenditure (capex) of $379m, based on the findings of a preliminary feasibility study (PFS).
The initial costs include the development of the underground mine, construction of an 850,000 tonne per annum processing plant and facility, a 3.93 million tonnes (Mt) fully lined dry tailings storage facility, and additional infrastructure.
Dundee Precious Metals has also included a contingency amount of $50m.
According to the PFS, the Čoka Rakita project will have an operating mine life of 10 years.
Over the life of the mine, total production at the Serbian gold project is expected to be 1.2 million ounces. In the first five years, gold production is expected to accelerate, averaging 170,000 ounces per year.
The PFS projects a post-tax net present value (NPV) of $735m for the gold project. It also estimates an after-tax internal rate of return (IRR) of 41%, with a payback period of 1.7 years.
Besides, the Čoka Rakita gold project is expected to generate a post-tax free cash flow of $1.07bn.
The project will utilise existing processing equipment from the Ada Tepe mine and benefit from the proximity to the Chelopech mine to train and develop key personnel for operating roles.
Located around 35km northwest of the city of Bor, the Čoka Rakita project is said to be a strong fit with the company’s underground mining and processing operations. The project is also located nearly 320km northwest of the Chelopech mine in Bulgaria.
Dundee Precious Metals is proceeding with a feasibility study (FS) following the robust PFS results and continued exploration success at the Čoka Rakita project.
The FS is expected to be completed by the end of 2025. The company is aiming for an accelerated construction decision, with the goal of achieving first concentrate production targeted for 2028.
Construction at the Čoka Rakita gold project is slated to commence in mid-2026.
Dundee Precious Metals CEO and president David Rae said: “We are very excited by the results of the pre-feasibility study. In less than 24 months since announcing the initial discovery of Čoka Rakita, we have outlined a very robust, highly value accretive project with the potential to add high-margin gold production growth to our portfolio.
“Given the project’s excellent economics, including a 41% IRR at a gold price of $1,900 per ounce, we are immediately proceeding to a feasibility study while advancing permitting activities in parallel, with the goal of commencing construction in mid-2026 to support first production of concentrate in 2028.”
