Good morning. My name is Marvin, and I will be your conference operator today. At this time, I would like to welcome everyone to Liberty Gold's conference call to discuss the results of the feasibility study of the Black Pine oxide gold project in Idaho. Susie Bell, Vice President, Investor Relations and Corporate Communications, will run the call for Liberty Gold. Susie, you may begin the call.
Thank you, Marvin, and good morning, everyone. Earlier today, Liberty Gold announced the results of the feasibility study for our Black Pine oxide gold project in southeastern Idaho. Joining me today on the call are Jon Gilligan, President, Chief Executive Officer, and Director, Tyler Cole, Vice President, Project Development, Matt Zietlow, Vice President, Permitting and External Affairs, and Richard Zaggle, Senior Director, Mining and Metallurgy. Jon, Tyler, and Matt will provide brief prepared remarks to accompany the feasibility slide presentation, after which we will open the call for questions. Richard is also joining us to support the technical discussion during the Q&A. Before we begin, I would like to remind listeners that comments made during today's call and answer to questions may contain forward-looking statements. Please refer to the cautionary statements contained in today's news release and presentation, as well as Liberty Gold's continuous disclosure filings.
Unless otherwise indicated, all dollar amounts discussed today are in U.S. dollars. The call is being recorded and will be available for replay. With that, I will turn the call over to you, Jon.
Thank you, Susie, and good morning, everyone. I wanted to set the scene by putting Black Pine into the broader context of where Liberty Gold stands today. In 2016, Liberty Gold, a then highly accomplished gold discoverer, picked up 100% ownership of the mineral leases at Black Pine in southeastern Idaho, believing it was on track for the next big win. It was a previously mined and reclaimed site, no mineral resource, great road access, a power line to the front gate, a large land position, and importantly, perfect geology for a major Carlin-style oxide gold discovery. With two years of desk work, 8 drill seasons, just over 300 km drilled and sampled, four environmental assessments under NEPA, and two engineering studies, Black Pine sits today with an indicated resource of just under 5 million gold ounces and just under 1 million gold ounces in the inferred category.
Having spent around $100 million to date on the project, that's an all-in cost of roughly $17 per feasibility level resource ounce in the ground. It is important to emphasize that Idaho is a great place to work. The state is emerging as one of the leading mining jurisdictions in the U.S., with established infrastructure, a long history of hard rock mining in the region, and a growing list of significant companies buying in or taking ground. Liberty Gold took the bold decision 18 months ago to reinvest itself as a credible developer.
We divested of non-core assets and grew in-house capability and capacity to build a project like Black Pine. With feasibility now complete, our focus is on advancing permitting, financing, and project readiness as we move Black Pine forward towards a permitting Record of Decision targeting Q1 2028. Now it's turn to the key results of the feasibility study.
The feasibility study provides engineering definition of the project as a buildable, operable, large scale, long-lived, U.S. oxide gold development story, while preserving the straightforward run-of-mine heap leach configuration that's been central to the Black Pine investment case. Of the key numbers on this slide, four encapsulate the essence of the opportunity. Firstly, scale. Black Pine now has a feasibility level mineral reserve estimate of some 4 million gold ounces. Secondly, auto-scale. The mine plan supports approximate average payable gold production of 202,000 oz per year over the first five years. That really underpins and de-risks financial payback. Thirdly, low capital intensity. The study indicates we can build Black Pine for an initial capital amount of approximately $411 million, which is an achievable amount for an aspiring producer like Liberty Gold. Fourth, operating cost discipline, critical for a viable project.
Life of mine all-in sustaining cost is approximately $1,566 per gold ounce, creating the potential for strong margins. The significance of the study is not in any one of those numbers in isolation. It's the confident generation and credible combination of production scale, capital efficiency, and operating simplicity. This creates the compelling expected feasibility level economic returns illustrated in the lower line of boxes. This is one we should really build. Liberty Gold's VP Project Development, Tyler Cole, will now take you through some of the key aspects of the study in more detail. Over to you, Tyler.
Thanks, Jon, and good morning, everyone. Before I walk you through the results, it's worth briefly explaining how we approached the feasibility study, because we viewed it as much more than simply producing an updated economic study. Our objective was to deliver a technically rigorous, executable project that provides a strong foundation for the next stage of engineering, construction, and ultimately long-term, safe, stable production. Really, we wanted a feasibility study developed through an operator's lens rather than one designed simply to be an attractive FS document, and I think that's reflected in the report that will be published in the coming weeks. Having said that, let's get into it. This slide provides an overview of the feasibility study site configuration. The site layout reflects the additional engineering definition developed through the feasibility study while maintaining the same fundamental project concept.
The layout also preserves flexibility for potential future mine expansions that are not incorporated into the feasibility study financial model and therefore represent potential upside beyond the base case. As noted on the slide, the feasibility study does not replace the Mine Plan of Operations that forms the basis for the permit applications currently under review by the applicable regulatory agencies. Matt will discuss the interface between the feasibility study and the permitting process shortly. Importantly, Black Pine remains a conventional open pit run-of-mine heap leach operation. Ore is mined and delivered directly to the heap leach facility without crushing or agglomeration. That simplicity is one of the project's core technical advantages. The feasibility study estimates gold recovery over the 16-year life of mine at approximately 70.2%.
The life of mine strip ratio is projected to be 1.34 to one waste to ore, which is a very low strip ratio, another big advantage of Black Pine. The average life of mine ROM throughput is modeled at 74,200 tons per day and approximately 433 million tons of ore is anticipated to be processed over the operating life. The slide also shows the evolution of head grade over the life of mine, prioritizing higher grade in the early years of the mine life with an average grade delivered to the heap leach pad of 0.35 g per ton in the first five years. This all supports the improved gold production profile, which is one of the most important outcomes of the FS.
Black Pine, as Jon mentioned, is expected to produce approximately 202,000 oz of payable gold annually during years one through five, including a peak in that timeframe of approximately 277,000 oz in year five. Over the 16-year mine life, average annual payable production is projected to be 177,000 oz, and in total, the mine plan delivers just over 2.8 million payable ounces of gold. The project also maintains a competitive cost profile with a life of mine AISC of approximately $1,566 per ounce. The key point is the FS delivers both a strong early production profile and significantly higher total life of mine gold production compared to the PFS. Turning to the mining schedule, this slide illustrates how the feasibility study mine plan has evolved from the PFS and why the production profile has improved.
There are three principal changes I would highlight beyond the organic growth of the resource and reserve. First, the mining rate has increased, supporting greater stacking rates and stronger cash generation. Second, stockpiling and rehandling have been significantly reduced, shown in the bar charts to the right of the slide in blue. This lowers costs, brings pre-production material into the operating schedule earlier, and defers lower recovery material until the end of the mine life. Third, Rangefront, one of our large primary production pits, has been brought forward allowing the lowest cost and best recovering ore body to be mined sooner. Together, these changes improve material movement and sequencing and deliver a strong production profile, particularly through the early and middle years of the operation. Initial capital is estimated at approximately $411 million.
That estimate reflects the mine process plant, support infrastructure, heap leach facility, pre-production activities, and other development components required to bring Black Pine into operation. The increase relative to the PFS needs to be considered in the context of the larger reserve base, higher annual production, and substantially greater life of mine gold production now incorporated into the project. This will be discussed further on the next slide. Black Pine also continues to benefit from the capital efficiency of the run-of-mine configuration. There is no conventional mill, no crushing or grinding circuit. This is also a benefit on the operating side with a life of mine unit operating cost estimated at $8.90 per ton of ore processed. This slide is important because it shows how Black Pine has advanced from the PFS through feasibility.
Initial capital has increased by 26%, but that supports the 30% increase to the mineral reserve across roughly the same mine life. Average ounce production in the first five years has increased by 10%, and the life of mine average ounce production has increased by roughly 31%, which sums to a total payable gold increase of 30% in the life of mine. This has been achieved all while maintaining a very similar unit operating cost. I'll now hand it back to Jon to discuss the key project economic metrics. Jon?
It demonstrates that the investment case for Black Pine is not dependent on today's gold price or long-term consensus pricing, or on achieving the study base case. In fact, the project generates attractive returns across a broad range of gold price assumptions. Importantly, the economics remain strong well below base case pricing. The sensitivity analysis here clearly demonstrates not only resilience to lower gold prices, with capacity to endure metal pricing well below $2,000 per gold ounce, but also substantial leverage to a higher gold price environment. Illustrating this, at $4,500 per gold ounce, after-tax NPV5 increases to approximately $4.3 billion with triple digit after-tax IRR and payback in under 16 months. This project has the clear potential for substantial free cash generation early in the mine life.
Before I wrap up with the investment case, I want to ask Matt Zietlow, Liberty's VP Permitting and External Affairs, to provide a brief update on where Black Pine stands from a permitting perspective. Over to you, Matt.
Thanks, Jon. Black Pine continues to advance through the federal environmental review process and initial state permitting under FAST-41. The Mine Plan of Operations deemed administratively complete by federal agencies in November of 2025. FAST-41 provides a coordinated and transparent framework for the overall permitting process leading to project initiation, including a publicly available timetable and coordination among participating federal and state agencies. The current coordinated permitting timetable targets a draft Environmental Impact Statement in early 2027, followed by the final EIS and Record of Decision under the published FAST-41 schedule in early 2028. One point that is particularly relevant following today's Feasibility Study is that the FS and the Mine Plan of Operations currently advancing through permitting are both based on the same fundamental project concept, an open pit, run-of-mine heap leach operation.
As you would expect, feasibility engineering has further refined aspects of the project design, offering a potential future pathway to additional value. We are working through those refinements within the established permitting process and maintaining close coordination between the engineering and permitting teams with a focus on maintaining permitting timelines in the FAST-41 overall schedule. Back to you, Jon.
Thanks a lot, Matt. Let me bring the discussion back to the investment case and to finish basically where we started. Firstly, scale. Black Pine has an approximate 4 million ounce gold mineral reserve supporting average annual production of approximately 202,000 gold ounces during the first five years, with approximately 177,000 gold ounces life of mine average production. Secondly, capital efficiency. Initial capital of approximately $411 million supports the strong build case for a straightforward open pit oxide gold mine. The competitive NPV to CapEx ratio of 5.8 is a simple metric that speaks to the substantial free cash generation projected at base case pricing. Thirdly, simplicity. Black Pine remains what it always has been, an open pit, run-of-mine heap leach operation with no crushing or agglomeration. This is not technically complex with few project elements, a truck shop, a heap leach pad, an ADR plant, and some offices.
It is well-suited to a modular build and a simple EPCM construction approach. Fourthly, finally, resilience. Even at $2,500 per gold ounce, Black Pine generates approximately $1.2 billion of after-tax NPV5 and a 33.4% after-tax IRR. Those are impressive metrics at that gold price. Completion of the Feasibility Study gives us a firm technical and economic basis on which to advance detailed engineering and ultimately move Black Pine towards a construction decision. In parallel, not only do permitting activities and project readiness continue, but we are also now well-positioned to commence project financing on the basis of a strong feasibility-defined project. We believe the Black Pine project is now an industry-leading oxide gold development project in a tier one U.S. jurisdiction.
We see in the feasibility study released today that rare and attractive combination in the gold space of project scale, low CapEx intensity, and technical simplicity, all combined to create a project with strong economic resilience. I look forward to updating the shareholders in the market as the project advances over the coming months. Thank you all for joining us today. Susie, let's open the call for questions.
Thank you very much, Jon and team. Marvin, the operator, we are ready to take questions. As a reminder to the listeners, Richard Zaggle, our Senior Director of Mining and Metallurgy, is also joining us and is available to address technical and metallurgical questions.
Marvin, with that, please provide instructions for participants who would like to ask a question.
Thank you. At this time, we will conduct a question and answer session. As a reminder, to ask the question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Lauren McConnell of Paradigm Capital. Your line is now open.
Good morning and congratulations to Jon and team. It is great to get this out, especially earlier than we were expecting and ahead of the conference season. I have got a couple of questions. Specifically just looking at that production profile, and there does seem to be a bit of a trough, in years 7- 10. Just wondering, what specifically drives that decline and what is the most realistic way to fill it? Is it primarily grade, recovery, pit sequencing, geometry or something like that?
Lauren, thanks very much for the question. I will give you a brief answer, then I will hand it over to Tyler to give you a little more details. I think simply, you may remember in the PFS we had that trough, and that was due to the stripping coming off the discovery pit, then pre-strip of Rangefront, and it was the lull where we were rehandling a lot of stock pile material that gave us that lull. What we found with the feasibility level is we have been able to bring Rangefront forward, I think a few years, and that takes out some of that mid-life drop. It does not remove it completely. We do have some options in the study to further improve that, and we will be looking at those in the next iteration during detailed engineering. Tyler, over to you.
Yeah, thanks, Jon, and good summary. Yeah. To echo what Jon said, we will continue to optimize the sequencing. That trough is still related to the stripping of Rangefront, and so we are looking at ways to improve that, and also potentially supplementing with some of the satellite pits that are currently sitting late in the mine life. We may have some levers that we can pull to pull those forward and help smooth that profile and bring ounces forward in the mine life.
Okay, perfect. That is really helpful. Then just one clarifying thing in terms of permitting. You guys have 74,000 tons per day life of mine average stacking rate, and for some reason, I had in my head that the Mine Plan of Operations was being permitted under 6,500 or 65,000 tons per day. Could you just clarify that and just is that assumed later in the mine life, assuming some sort of future amendment or supplemental EIS? I just want to make sure I reconcile what I had in my mind.
Thanks, Lauren. I will hand it over to Matt, but just the first couple of comments. We did the feasibility study on the basis of the increased mineral resource that we got from drilling and from metal pricing. So it is a larger mine, and we optimized the larger mine, which necessarily gives some kind of improvement or different result. However, we were quite clear internally to do a feasibility study that sat within the overall footprint of the Mine Plan of Operations because, as you rightly point out, that is the document that is going through permitting. Let me hand it over to Matt for some clarifying comments.
Yeah. Thanks, Jon. Thanks for your question, Lauren. Jon framed it up pretty well, and if you are somewhat familiar with the process as you likely are, the key takeaway here is that the Mine Plan of Operations that is essentially the foundation of going through permitting right now, is the same one that was deemed administratively complete late last fall, and it is the one that the Environmental Impact Statement is being constructed around. There will be continued advanced engineering and optimizations and things like that, going forward as we wrap up this first permitting process and get to a Record of Decision and then be able to move forward into construction. At that point, then everything that is potential future development will be looked at with regards to whether the agencies see it as a significant change or something that requires more permitting.
Okay, perfect. That is very helpful. Thank you, guys. Just one last one for me, and I can jump back in the queue. I just wanted to clarify the construction schedule. Is it still assumed to be sort of a nine-month-ish build, sort of a one-season build?
Yes, Lauren, we do anticipate a one-season build. We have done a fair amount of work already on detailed engineering from a construction scheduling point of view. We have had potential constructors on-site to look at the ground, and we have taken them through the plans and showed them the feasibility level construction schedules. We have even had one of those do their own schedule. Whilst I think it would be fair to admit it is quite aggressive, I think we firmly believe it is doable in one season, and that is going to remain our base case as we go into detailed engineering. Once that engineering is fully complete, somewhere around the middle of next year, there will be a final iteration on the construction schedule, and that will be the definitive document. But today, we remain confident that it is a one-season build.
Okay, perfect. Thanks so much, and congratulations again. I will let some others ask some questions.
Thanks, Lauren.
Thank you. One moment for our next question. Again, as a reminder, to ask a question, you will need to press star one one on your telephone. Our next question comes from the line of Norm Hill. Your line is now open.
Good morning. First, I just want to make a statement. You guys deserve tremendous credit because this project a few years ago was just a dream, and you have turned the dream into something real. This thing is on its way to production, so it is fantastic. Anyway, my real question is this: the production is supposed to start in about two years. The gold price two years from now should be somewhere closer to about $5,000. At $5,000, what sort of economics does this project present? Thank you.
Really appreciate the question, and thank you very much for your comments about the team. It really has been an exciting journey over the last five years to go through PFS into now feasibility. To answer your specific question, at $5,000 gold, the feasibility study projects a just over $5 billion NPV after tax, NPV5 for a 121.8% IRR after tax, and a 12-month payback. Not too shabby.
Thank you very.
Thank you for your question.
Okay. I am showing no further questions at this time. I will now turn it back to Jon Gilligan for closing remarks.
Thank you very much, Marvin. I really appreciate that. Thank you everyone for attending the call. We remain available for other calls if you would like. Please contact Susie Bell, and the team will be standing by if anyone has any specific other details to discuss. Really appreciate it. Have a great day, everybody, and goodbye.
Thank you for your participation in today's conference. This concludes the program. You may now disconnect.