Meridian Mining (LSE:MNO), the London and Toronto-listed developer of the Cabaçal gold-copper-silver project in Mato Grosso, Brazil, reported a Definitive Feasibility Study (DFS) showing an after-tax net present value at a 5% discount rate (NPV5) of $2.09 billion and an internal rate of return of 108%.
The study projects payback within 0.9 years and an NPV5-to-capex ratio of 6.5 times, using base case prices of $3,570 per ounce gold, $5.03 per pound copper and $50.17 per ounce silver.
At spot prices of $4,394 gold, $6.53 copper and $64.14 silver, the NPV5 rises to $2.902 billion.
The DFS supersedes Cabaçal's March 2025 Preliminary Feasibility Study, with an updated mineral reserve, optimised mine plan and improved metallurgy.
Life-of-mine all-in sustaining costs stand at $1,056 per ounce of gold equivalent, falling to $715 per ounce across the first five years of production, when average annual output reaches 183,526 gold-equivalent ounces and after-tax free cash flow averages $413.8 million a year.
Initial capital expenditure is set at $322 million, including a 10% contingency and pre-investment for a planned expansion to 4.5 million tonnes per annum from year four.
"The DFS delivered a NPV5 exceeding two billion dollars, an IRR over one hundred percent and a payback of less than one year", said chief executive Gilbert Clark.
Meridian has already committed $15.9 million in capital contracts, including earthworks, and has begun civil works on water management infrastructure and the tailings storage facility.
The company has also secured an installation licence for the power line connecting Cabaçal to the grid, with construction targeted to begin in the first quarter of 2027, subject to project financing.
News Intelligence what this means for the company
Meridian Mining's Definitive Feasibility Study for Cabaçal shows a $2.09 billion after-tax NPV5 and 108% IRR, with payback in under one year and initial capex of $322 million—metrics that anchor the project's economic case ahead of a 2027 production target. The company has already committed $15.9 million to capital contracts and begun civil works, moving from study phase into tangible construction, with an installation licence for the power line secured and grid connection targeted for Q1 2027 subject to project financing.
The DFS supersedes the March 2025 PFS with an optimised mine plan and improved metallurgy, establishing the technical and economic foundation for project financing. Execution risk now shifts from feasibility to capital raise and construction delivery, with the sub-one-year payback and 6.5× NPV-to-capex ratio providing a strong basis for debt and equity discussions.
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