B2Gold announced preliminary economic assessment (PEA) results for its Gramalote project in Colombia, boasting a "significant gold production profile with low-cost structure and favourable metallurgical characteristics".

B2Gold proposes an open-pit gold mine with an initial life of 10 years and mill processing over 12.5 years. The mine will produce an average of around 185,000ozpa and process an average of 1gpt gold over the project's life.

Gramalote's economics are expected to be an after-tax free cash flow of $1.38 billion, an after-tax NPV (5%) of US$778 million, and an after-tax IRR of 20.6%.

The project was formerly a joint venture with AngloGold Ashanti, but after the companies deemed the project unable to meet investment return thresholds for development based on preliminary results from 2022, B2Gold acquired full ownership.

"Post consolidation, B2Gold completed a detailed review of the Gramalote project, including the higher-grade core of the resource, facility size and location, power supply, mining and processing options, tailings design, resettlement, potential construction sequencing and camp design to identify potential cost savings to develop a medium-scale project," B2Gold said. "The results of the review allowed the company to determine the optimal parameters and assumptions for the PEA."

Next, B2Gold plans to start feasibility work, aiming to have a completed feasibility study by mid-2025.

"Due to the work completed for previous studies, the work remaining to finalize a feasibility study for the updated medium-scale project is not extensive," the company added. "The main work programs for the feasibility study include geotechnical and environmental site investigations for the processing plant and waste dump footprints, as well as capital and operating cost estimates."

B2Gold's shares are trading at C$3.51, a dip of around 15% since the beginning of the year. It has a market cap of C$4.58 billion.