Velocity Minerals (TSXV: VLC; US-OTC: VLCJF) recently tabled a preliminary economic assessment for its Rozino gold project in southeast Bulgaria and as a result will soon earn a 70% in the project.
To earn its interest the company must deliver the full report to the property owner, and says it will do so in the coming weeks. The project sits on the Tintyava property, 85 km by road from the town of Kardzhali in eastern Bulgaria.
According to the report, the project has a $129 million after-tax net present value at a 5% discount rate and a 33% after-tax internal rate of return. It envisions an open pit mine with on-site flotation producing gold concentrate the company would transport to an existing carbon-in-leach (CIL) plant located in Kardzhali.
The project would produce 65,000 oz. gold per year over six years for a $97.6 million initial capital expenditure. The company says using the existing CIL plant cuts costs and shortens its permitting timelines.
The company has progressed the project quickly since optioning it in July 2017. It tabled a maiden resource for Rozino in March 2018. The report includes an updated resource from early September 2018. The project now contains 13 million inferred tonnes grading 1.37 grams gold for 573,000 oz. gold.
Velocity based the initial resource on 90 holes, including 56 it drilled. The updated resource includes an additional 12 holes.
After delivering the report Velocity will begin working toward a prefeasibility study at Rozino.
The company is looking at other properties in the area. It wants to earn 70% interests in several satellite deposits and produce more than 100,000 oz. gold per year over 10 years.
Shares of Velocity are currently valued at 16¢ with a 52-week range of 13¢ to 40¢. The company has an $11 million market capitalization.