How Tesoro Gold’s El Zorro Project Could Deliver 1.26 Million Ounces Over 13.5 Years

A Compelling Chilean Gold Opportunity

Tesoro Gold Limited has released an updated Scoping Study for its El Zorro Gold Project, focusing on the Ternera Gold Deposit located in Chile’s Atacama region. The study outlines a technically feasible and economically attractive open pit gold mining operation supported by a 3.0 million tonnes per annum carbon-in-pulp (CIP) processing plant. Over an initial 13.5-year mine life, the project is forecast to produce approximately 1.26 million ounces of gold.

Set against a conservative base-case gold price of US$2,750 per ounce, the study delivers a pre-tax net present value (NPV) at a 7.5% discount rate of US$917 million and an internal rate of return (IRR) of 60%. Post-tax, the NPV stands at US$663 million with a 51% IRR, and a payback period of just 20 months, underscoring the project’s financial robustness.

Technical and Operational Highlights

The Ternera Deposit’s mineral resource estimate includes 71% Indicated and 29% Inferred resources, with the production schedule weighted heavily towards Indicated material during the critical early years. The open pit design contemplates mining approximately 40.7 million tonnes of ore at an average grade of 1.02 grams per tonne gold, with an overall strip ratio of 8, 1.

Metallurgical test work has demonstrated excellent gold recoveries averaging 94.5%, achieved through a straightforward CIP process. Notably, the process water will be sourced sustainably from a nearby desalination plant, aligning with modern environmental standards.

Capital expenditure is estimated at US$248 million for pre-production, including plant construction, infrastructure, and pre-strip mining activities. Operating costs are competitive, with an all-in sustaining cost (AISC) forecast at US$1,216 per ounce, supporting strong margins at current gold prices.

Strategic Location and Infrastructure

El Zorro benefits from a strategic location with access to established infrastructure, sealed roads close to the deposit, proximity to the port of Caldera, and grid power connection options with signed memoranda of understanding in place. Water supply arrangements via brine from the Totoralillo desalination plant further enhance project sustainability.

The project is greenfield, requiring full development of site facilities, including a 250-person accommodation camp and communications infrastructure. Environmental baseline studies and permitting processes are underway, with no current impediments identified to project approvals.

Next Steps and Growth Potential

Following board approval, Tesoro plans to commence a Pre-Feasibility Study (PFS) targeting completion in the second quarter of 2026. Concurrently, exploration drilling will continue to target resource extensions and new discoveries within the broader El Zorro district, which Tesoro describes as a district-scale gold opportunity.

Potential upside includes expanding the open pit, evaluating underground mining options, and converting Inferred resources to higher confidence categories. The company’s management team brings extensive experience in Chilean mine development, financing, and operations, positioning Tesoro well to advance the project.

Risks and Considerations

While the study presents a promising outlook, it remains a preliminary assessment with an accuracy level of ±35%. The inclusion of Inferred resources introduces geological uncertainty, and funding of approximately US$250 million is required to progress development, with no guarantee of securing financing on favourable terms. Additionally, gold price volatility, inflationary pressures, and permitting timelines represent ongoing risks.