Meridian Jumps as Cabaçal Study Puts Project NPV at $2.09 Billion

Meridian Mining shares rose 10% in early London trading on September 22, reaching 109 pence, after a feasibility study put the after-tax value of its Cabaçal project in Brazil at $2.09 billion. The company also trades in Toronto, where shares gained 18% to C$2.21 in morning trading, according to The Northern Miner.

The $2.09 billion figure is the project’s net present value, a measure of expected future cash flows adjusted for time. Meridian’s study used a 5% discount rate and forecast a 108% return, with the initial investment recovered in 0.9 years.

Those estimates assume gold at $3,570 an ounce, copper at $5.03 a pound and silver at $50.17 an ounce. At higher spot-price assumptions used in the study, the estimated value rises to $2.90 billion.

Cabaçal’s earlier 2025 study estimated a $984 million net present value and $248 million in initial capital costs. The new study raises initial costs to $322 million, before a further $56 million for a planned expansion.

The mine plan spans 13.9 years. Meridian forecasts average annual production of 183,526 gold-equivalent ounces in the first five years, when it expects average annual after-tax free cash flow of about $414 million.

The strong early cash-flow forecast depends partly on mining higher-grade material first. The company estimates life-of-mine all-in sustaining costs at $1,056 per gold-equivalent ounce, compared with $715 an ounce over the first five years.

The study does not mean the mine is ready to produce. Meridian’s application for a Brazilian installation licence remains under review, and it is seeking construction financing from as many as 30 lending groups, the company said.

Investors will be watching for progress on that permit and funding. Meridian has committed $15.9 million to pre-construction work and says it has begun purchasing some equipment with long delivery times.