The report will now be presented to the Comision de Evaluacion Regional de Chile for a vote. This body comprises 11 government institutions with environmental competences, including the country’s ministries of mines and environment.

A decision on the environmental impact assessment (EIA) of the project is expected within the next two weeks, the company said. If rejected, Rio2’s Chilean subsidiary Fenix ​​Gold Limitada may resubmit the EIA with additional information, analysts said. The building permit for the project was initially expected to be issued in the third quarter of 2022.

“Fenix ​​Gold has worked diligently throughout the environmental assessment process to provide all required information,” Rio2 said in a press release. “Fenix ​​Gold remains committed to continuing to work with the SEA and other government institutions to resolve and mitigate any potential impacts that require further review to gain project approval.”

In December, Chile asked Gold Fields (NYSE: GFI; JSE: GFI) to come up with a new plan to relocate 20 endangered chinchillas from its Salares Norte gold project in the same area.

Located approximately 20 km south of the La Coipa mine of Kinross Gold (TSX: G; NYSE: KGC) and approximately 680 km north of the capital Santiago, the Fenix ​​gold project covers 160.5 km² and has proven and probable reserves of 116 million tonnes. grading 0.49 grams of gold per tonne for 1.8 million contained ounces. of gold and 1.3 million recoverable ounces. gold.

Based on a 2019 pre-feasibility study, the project is expected to have a 16-year lifespan and produce approximately 93,000 oz. of gold on average for the first 13 years at an all-in sustaining cost of US$997 per ounce. Pre-production investments were set at $111 million.

Using a gold price of $1,500 per ounce. and at a discount rate of 5%, the project would generate an after-tax net present value (NPV) of $241 million and an after-tax internal rate of return of 44%.

“We assume Fenix ​​obtains EIA approval in July, but have postponed first gold production to 3Q23,” Raymond James analyst Craig Stanley wrote in a research note to Reuters. clients. “Given the uncertainty of approval…we have lowered our rating to Market Perform.”

Shares of Rio2 closed down 23¢C, from 54¢C, following the announcement of the EIA’s rejection on June 23. As of press time in Toronto on June 24, the company’s shares were trading at 28.5¢C in a 52-week trading range. from C21.5¢ and C85¢.