Castelo de Sonhos PFS: $603M NPV, 40% IRR
TriStar Gold Inc.'s Castelo de Sonhos in Brazil has a Pre-Feasibility Study (PFS) outlining an after-tax NPV of $603M, an after-tax IRR of 40%, and initial capital of $296M. The mine plan runs 11 years at about 121 koz Au per year.
TriStar Gold Inc.'s Castelo de Sonhos has reported Pre-Feasibility Study (PFS) results for the gold project in Brazil. The study headlines an after-tax net present value of $603M at a 5% discount rate. It reflects TriStar Gold Inc.'s (TSG.V) latest disclosed economics for the asset.
Economics. The after-tax NPV is $603M using a 5% discount rate. After-tax IRR is 40%. Initial capital expenditure is estimated at $296M. The study models a payback period of 2 years. All-in sustaining costs are pegged at 1111 USD/oz. Economics are based on $2,200/oz gold (base case); $3,200/oz gold (sensitivity).
Production and mine plan. The project envisions an open-pit operation. Life of mine is 11 years. Average annual production is approximately 121 koz Au. Average head grade is 1.3 g/t Au (Phase 1, Years 1-6); 0.8 g/t Au (Phase 2, Years 7-11). Metallurgical recovery averages 98%.
Resources and ownership. Mineral reserves: 38.7 Mt at 1.1 g/t Au for 1.4 Moz (Probable). Mineral resources: Indicated: 53.1 Mt at 1.0 g/t Au for 1.8 Moz; Inferred: 26.0 Mt at 0.9 g/t Au for 0.7 Moz.
These figures are extracted from TriStar Gold Inc.'s technical disclosures and reflect the most recent PFS on file. Compare this project against other developers and producers in our project economics database, and always verify the numbers against the original technical report before making any investment decision.
Our Analysis
The 40% after-tax IRR places this project in the upper half of the 90 gold developers we track, well above the 20%+ threshold required for a single-asset junior to secure financing. The 5% discount rate used for NPV reporting is at the low end of convention, which inflates the headline $603M NPV; a higher, more conservative rate would compress that figure materially. The NPV sits at roughly 12.7x market cap—a wide gap that cuts both ways: it could signal the market has not yet priced in the asset’s value, or it could reflect skepticism on permitting, jurisdiction, or the ability to fund development without heavy dilution.
Capital intensity is low at $296M (49% of NPV), which eases the funding burden, but the base-case gold price of $2,200/oz is well below the current spot of $4,193.80/oz, making the returns appear conservative on price. The 2-year payback and 11-year mine life are moderate. The single most important risk is the market-cap-to-capex ratio: with a market cap roughly one-eighth of the NPV, even modest cost overruns or equity financing needs could severely dilute existing shareholders.
Our take, benchmarked against the project economics in the Mining Stocks database. Figures are estimates drawn from company technical reports — not investment advice; always verify against the source filing.