Orla Mining (TSX: OLA; NYSE: ORLA) has announced plans to begin construction at its South Railroad gold project in Nevada, following a feasibility study that revealed capital costs have surged to $395 million, up from $190 million in 2022. The increase is attributed to inflation and updated project management requirements. Full construction is expected to start by mid-2026, pending final permits.
Located 700 km northeast of Las Vegas, the South Railroad project is part of the Carlin Trend and holds 66.6 million tonnes of proven and probable reserves, translating to 1.52 million ounces of gold. The project aims for average annual gold production of 104,000 ounces over ten years at an estimated all-in sustaining cost of $1,505 per ounce. Based on current projections, the after-tax net present value (NPV) stands at $783 million, with an internal rate of return (IRR) of 48% at a gold price of $3,100 per ounce.
Orla anticipates that the first production will commence in 2028. The company has conducted extensive drilling, completing 57,800 meters over the past three years, including 18,000 meters in last year alone, with aggressive exploration plans set for 2026. Following the announcement, Orla’s shares fell by 1.1%, bringing its market value to approximately C$6.9 billion (USD $5 billion).
