Horizon Gold Limited (ASX: $HRN) Scoping Study Overview

Horizon Gold Limited (ASX: $HRN) has released an addendum to its announcement titled 'Compelling Gum Creek Scoping Study.' The study projects an average recovered gold production of approximately 84,000 ounces per year over a 10-year Life of Mine (LOM) and outlines robust financial metrics. The base case gold price used in the study is A$2,900/oz, with potential upside to predicted financial outcomes at the current spot gold price of A$3,300/oz. The company is preparing to commence a feasibility study and other activities to further enhance the project's positive economics.

Executive Commentary on Scoping Study

The Scoping Study for the Gum Creek Gold Project demonstrates strong economic fundamentals and potential for significant value delivery to shareholders. The study justifies the project's commercial viability as a stand-alone mining operation, prompting consideration for the commencement of a Feasibility Study. Further economic assessment work will focus on reducing pre-production and sustaining capital expenditure, as well as evaluating grade cutoff options and processing throughput rates. The company is also exploring potential shallow resource expansion drilling and underground mining options to extend the proposed mine life.

Summary of Scoping Study and Outlook

Horizon Gold Limited's Scoping Study for the Gum Creek Gold Project indicates an attractive return on capital investment and robust cashflows, even at a base case gold price approximately A$400/oz below current spot gold prices. The study recommends commencing a feasibility study and further work to enhance project economics, including reducing pre-production and sustaining capital expenditure, evaluating grade cutoff options, and resource drilling to expand shallow oxide resources. The company's tight capital structure and 100% ownership of the project make potential financing arrangements simpler. The board's extensive experience in mine development and production in the resources industry is attractive to potential financiers. The study provides a comprehensive overview of the project, highlighting its potential for commercial success and the next steps for further development.