Orla secures final permit to advance underground mining at Camino Rojo
Orla Mining has secured the final permit needed to develop an underground mining operation at its Camino Rojo project in Mexico, which is projected to deliver a 30% internal rate of return (IRR) over 17 years based on gold prices of $3,100 per ounce. The underground expansion beneath the existing open pit represents a significant capital deployment opportunity for the company to extend the asset's mine life and improve project economics.
Orla Mining Ltd. has achieved a major regulatory milestone by securing the final permit required to advance underground mining operations at its flagship Camino Rojo project located in Mexico. This development marks a critical step forward in the company's strategy to unlock additional mineral reserves and extend the operational life of the asset through subsurface extraction below the existing open-pit mine.
The underground operation is positioned to generate exceptional returns for shareholders, with projected economics demonstrating a 30% internal rate of return (IRR) over a 17-year mine life, assuming gold prices average $3,100 per ounce. This robust financial profile underscores the economic viability of the underground development and highlights the resource quality at depth within the Camino Rojo deposit.
Underground mining at Camino Rojo represents a natural progression for the asset and exemplifies how modern mining companies are maximizing value from their portfolios. By developing underground operations beneath the open pit, Orla can access deeper mineral resources that would otherwise remain economically unviable, thereby extending production capacity and maintaining long-term operational sustainability. This approach is increasingly common in the gold mining industry, where operators seek to optimize extraction from mature or fully-developed surface operations.
The final permit acquisition is particularly significant given the complex regulatory environment in Mexico, where mining projects require multiple approvals from federal and local authorities. Securing this final authorization demonstrates Orla's successful navigation of the permitting process and its commitment to operating as a responsible corporate citizen. The company's ability to advance major development projects through Mexico's regulatory framework positions it favorably for future growth initiatives.
Camino Rojo is a world-class gold project that has emerged as one of the industry's premier undeveloped assets. The project benefits from substantial mineralization, favorable metallurgy, and strategic location within Mexico's established mining infrastructure corridor. The combination of these attributes makes the project attractive to investors and positions Orla competitively within the gold sector.
The underground development comes as gold markets remain supported by geopolitical uncertainty, central bank demand, and portfolio diversification trends. With spot gold prices currently elevated compared to historical averages, the $3,100 per ounce assumption represents a conservative long-term price deck for feasibility analysis. This conservative stance suggests the project could deliver even greater value if realized prices exceed assumptions.
From a strategic perspective, Orla Mining's advancement of Camino Rojo's underground phase demonstrates the company's capital deployment discipline and long-term vision. By phasing development to first optimize the open pit while simultaneously developing underground permits and infrastructure, Orla minimizes execution risk while positioning the asset for multi-decade production.
The project's 30% IRR metric is particularly noteworthy, as it exceeds typical hurdle rates for major mining companies and reflects the high-quality nature of the Camino Rojo resource. This economics framework provides confidence in the project's NPV contribution and return on invested capital, making it an attractive addition to Orla's production profile.
Moving forward, Orla will focus on detailed engineering, construction planning, and capital markets activities to support the underground development transition. The company's successful permit navigation suggests a clear pathway toward project development and production commencement, pending standard financing and operational readiness milestones.