Volcan Project (Dorado Deposits) PEA: $1.51B NPV, 29% IRR
Tiernan Gold Corp.'s Volcan Project (Dorado Deposits) in Tierra Amarilla, Atacama Region, Chile (Maricunga Gold Belt) has a Preliminary Economic Assessment (PEA) outlining an after-tax NPV of $1.51B, an after-tax IRR of 29%, and initial capital of $1.02B.
Tiernan Gold Corp.'s Volcan Project (Dorado Deposits) has reported Preliminary Economic Assessment (PEA) results for the gold project in Tierra Amarilla, Atacama Region, Chile (Maricunga Gold Belt). The study headlines an after-tax net present value of $1.51B at a 5% discount rate. It reflects Tiernan Gold Corp.'s (TNGD.V) latest disclosed economics for the asset.
Economics. The after-tax NPV is $1.51B using a 5% discount rate. After-tax IRR is 29%. Initial capital expenditure is estimated at $1.02B. All-in sustaining costs are pegged at 1094 USD/oz. Economics are based on PRICEDeck: base case $1,800/oz gold pit shell optimization; M&I & Inferred resources at $1,600/oz gold price.
Production and mine plan. The project envisions an open-pit operation. Average annual production is approximately 330 koz Au. Average head grade is 0.63 g/t Au (heap feed). Metallurgical recovery averages 64.2%. The open-pit strip ratio is 1.5 W:O.
Resources and ownership. The company holds a 100% interest in the project. Royalties and streams: 1.5% NSR on gold and copper production to Franco-Nevada (July 2023); US$15M cash payment; ROFR on future royalties/streams; option to acquire further 1% royalty at construction decision.
These figures are extracted from Tiernan Gold Corp.'s technical disclosures and reflect the most recent PEA 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.
Reserves & Resources
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Measured | 123,979 kt | 0.700 g/t Au | 2,792 koz Au |
| Indicated | 339,274 kt | 0.643 g/t Au | 7,013 koz Au |
| Measured & Indicated | 463,253 kt | 0.658 g/t Au | 9,804 koz Au |
| Inferred | 75,018 kt | 0.516 g/t Au | 1,246 koz Au |
Our Analysis
- IRR after-tax
- 29%
higher than 32% of 119 projects we track
- NPV after-tax
- $1.51B
higher than 77% of 170 projects we track
- Initial capex
- $1.02B
67% of NPV
costlier than 89% of 163 projects we track
- Discount rate
- 5%
- Study price assumption
- PRICEDeck: base case $1,800/oz gold pit shell optimization; M&I & Inferred resources at $1,600/oz gold price
- Spot gold today
- $4,321.20/oz
A US$266M micro-cap is trying to build a US$1.02B mine. That ratio, roughly 3.8x the company's entire equity value, is the fact that decides this project, not the headline numbers. No developer of this size writes a cheque that large from the treasury; it comes from a partner, a streaming or offtake deal, project debt against a completed feasibility study, or equity issued at whatever price the market offers. Each route costs existing holders something, and the equity route costs them the most. The company has two other projects in our tracking set, which helps a little at the negotiating table and does not change the arithmetic.
The economics themselves are respectable but not the reason to own it. An after-tax NPV of US$1.51B ranks above 77% of the 170 gold projects we track, yet the 29% after-tax IRR sits above only 32% of the 119 projects we compare on that measure, a lower-half result. That gap tells you the value is concentrated in a long, capital-hungry build rather than in fast payback. On the financing hurdle that matters, 29% clears the roughly 15% developers need for project finance and the 20%-plus a junior with little else in the portfolio should demand, so the return is adequate rather than exceptional.
Two things temper the numbers further. This is a PEA, scoping-level work that may lean on inferred resources and carries a capital estimate with a plus or minus 50% band, so the US$1.02B could move materially in either direction before anyone lends against it. And the study prices gold at US$1,800/oz for pit optimisation and US$1,600/oz for resources, well below today's US$4,321.20/oz spot, which leaves genuine upside if those levels hold. Atacama is a mining-friendly jurisdiction, and capex at 67% of NPV is moderate by the standards of the 163 projects we track, though that is cold comfort for a company this small. The question is whether anyone will fund the build on terms that leave existing shareholders with a meaningful stake.
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.