Prodigy Gold Inc fka PDG (PDG)

[NYBob]

Prodigy Gold soars after PEA results from Magino
indicate 49% IRR
Mon 1:41 pm by Deborah Sterescu



Prodigy Gold soars after PEA results from Magino
indicate 49% IRR

Prodigy Gold's (CVE:PDG)
shares rose as high as 19% on Monday after the company announced
an estimated 49% internal rate of return from its Magino gold
project in northern Ontario, with cash costs of just
US$496 per ounce.

Following the release of the comany's preliminary economic
assessment (PEA) on the Magino mine today, its shares soared
to $0.50 as of 11:46am EST - up nearly 15%.

The NI 43-101 compliant report, led by CWA Engineers,
also estimated that using a US$1,000 per ounce gold price,
the open pit gold project would generate a pre-tax
net present value of $351 million at a 5% discount rate.

Average annual gold production for Magino is projected
at 166,500 ounces per year over a nine-year operating life,
for 1.50 million total ounces of recovered gold.
The recovery rate is estimated at a whopping 95%,
with the average grade processed during the first
two years of operations expected to be 1.6 g/t gold.

Prodigy said that start up capital costs were calculated
at $242 million, with an additional $34 million in
sustaining capital, and a payback period of 1.8 years.

"With a projected mine life of nine years, cash costs
of US$496 (Cdn$521) per ounce and rapid payback of capital,
Magino is developing into one of the leading undeveloped gold
projects in eastern Canada," said president and CEO Brian Maher.

"The on-going in-fill drilling program, which is targeting
gold mineralization within the proposed open pit, may enhance
project economics as we convert internal waste into resources,
simultaneously increasing contained ounces and lowering costs."

The company said it plans on updating the preliminary economic
report once this drilling is completed.
Based on the pit design and production schedule used for
the study, Magino has total mineable resources of
41.8 million tonnes, grading 1.18 g/t gold.

A full feasibility study for the proposed open pit mining
project is scheduled for early 2012.

http://www.proactiveinvestors.com/companies/news/13570/prodigy-gold-soars-after-pea-results-from-magino-indicate-49-irr-13570.html