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Intl Tower Hill Mines Edges Higher as Increases Alaska Gold Resource Estimate, But Mine Development Costs High

Intl Tower Hill Mines (ITH.TO) is up 6 cents at $8.13, but off a day high $8.45 after announcing the results of an updated preliminary economic assessment demonstrating robust project economics for the company's 100% owned Livengood Gold Project located near Fairbanks, Alaska.

It said the PEA results (all USD) demonstrate project financial highlights of $3.1 billion pre-tax cash flows and a $1.2 billion Net Present Value at a 5% discount rate at a Base Case gold price of $1,100/oz. In addition, an updated resource estimate has significantly expanded the surface mine mineralization to 16.5 million ounces gold contained in the Measured & Indicated categories and 4.1 million ounces gold contained in the Inferred resource category.

Highlights of the Updated Resource Estimate & PEA:

- Processing rate of 91,000 tonnes per day with average annual production over the first five years of 664,000 ounces of gold and 562,000 ounces gold over a Life of Mine of 23 years, making it potentially one of the largest single gold mines in North America.

- Cumulative pre-tax cash flows of $3.1 billion, NPV of $1.2 billion (at a 5% discount rate), Internal Rate of Return of 14.1% and a payback period of 4.9 years using a Base Case gold price of $1,100 per ounce.

- An estimated initial capital cost of $1.61 billion, including $323 million in contingency and owner's costs. Average cash cost of $557 per ounce over the first five years of production and an average Life-of-Mine cash cost of $703 per ounce.

- The current surface mine resource is largely constrained by existing drilling (un-estimated blocks due to lack of data) indicating longer term expansion potential as continuing exploration expands the drill grid.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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