Desert Gold Delivers PEA Update for SMSZ Project with USD $61 Million After-Tax NPV (10%) and 57% IRR at USD $2,850/oz Gold for Barani and Gourbassi Deposits in West Mali
Desert Gold Delivers PEA Update for SMSZ
Project with USD $61 Million After-Tax NPV
(10%) and 57% IRR at USD $2,850/oz Gold for
Barani and Gourbassi Deposits in West Mali
Delta, British Columbia--(Newsfile Corp. - November 25, 2025) - Desert Gold Ventures Inc. (TSXV:
DAU) (FSE: QXR2) (OTCQB: DAUGF) ("Desert Gold" or the "Company") is pleased to announce the
results of its newly updated Preliminary Economic Assessment ("PEA") for the Barani and Gourbassi
deposits, located on its 100%-owned SMSZ Gold Project in western Mali.
The updated PEA outlines the open-pit oxide mining operation with the addition of the Gourbassi East
Deposit with projected increase in production from 18,000 tonnes per month to approximately 36,000
tonnes per month (or 432,000 tonnes per annum at steady state) over a mine life of 10 years. The study
was completed by
Minxcon
, with technical work and cost estimation exceeding the minimum standards
typically required for a PEA and completed to a confidence level of ±25% accuracy.
The PEA mine plan includes a total of 130,700 ounces of gold contained, with an estimated 113,100
ounces expected to be recovered through a simple, gravity and CIL processing flowsheet, based on an
average metallurgical recovery of 87%. At a new base gold price of USD $2,850/oz, the project
generates an after-tax Net Present Value (NPV) at a 10% discount rate of USD $61 million, an Internal
Rate of Return (IRR) of 57%, and a projected payback period of 2.5 years.
At the current spot gold price of USD $4,070 the project generates an after-tax Net Present Value (NPV)
at a 10% discount rate of USD $124 million, an Internal Rate of Return (IRR) of 101%, and a projected
payback period of 2.1 years.
The mining plan is still designed to be broken out into two phases, starting with open-pit operations at
Barani East before transitioning to the Gourbassi deposits. A modular gravity and CIL processing plant
will be commissioned at Barani for the first phase of production and later moved to Gourbassi as
operations shift. This staged approach helps keep initial capital costs low, avoids duplicating
infrastructure, and allows the Company to unlock value from multiple oxide gold zones across the SMSZ
Project in a flexible and cost-effective manner.
PEA Highlights:
After-tax NPV
10%
of $61 million and after-tax IRR of 57% based on $2,850/oz gold
Doubling gold production from 18.3kt per month to 36kt per month
Addition of the Gourbassi East oxide and transition pit
Changing the baseline forecast from $2,500 to $2,850
Funding requirement increased from $16 million to $23 million to increase production
Updated mine life of 10 years
All in sustaining cost per oz ("AISC") of USD $1,137
After-tax payback of 30 months at base case of $2,850/oz gold
Cumulative cash-flow of $126 million after-tax over 10 years on base case assumptions
Total payable gold production of 113,100 ounces
Average strip ratio for the combined operations is estimated at 2.60:1
Company CEO Jared Scharf commented: "We are delighted to bolster our previous mine strategy. With
less than 10% of the SMSZ Project's total gold resources incorporated into this study, there is substantial
opportunity to enhance project economics and materially expand the operation over time. The mining
approach has been deliberately designed to remain modular and flexible from a processing standpoint,
giving us maximum operational optionality as the project advances. The inclusion of Gourbassi East into
the current model, as well as, doubling production to 36 kilotons per month marks another important step
in strengthening a quicker payback period as well advancing the mine life. Exploration will continue to be
a key priority across Barani, Gourbassi, and Gourbassi East, where multiple near-mine targets provide
clear potential for rapid additions to future mine plans. Coupled with numerous brownfield opportunities
situated close to the Barani starter pit, management sees a strong likelihood of materially expanding this
operation over time."
Table 1.
Financial and Operating Metrics from the Preliminary Economic Assessment
*Note: This Preliminary Economic Assessment (PEA) is an early-stage study that includes Inferred Mineral Resources. These resources are
considered too geologically uncertain to support economic evaluations that would allow them to be classified as Mineral Reserves. As such, this
PEA is preliminary in nature and its results-including projected mine plans and economics-should not be relied upon as definitive. There is no certainty
that the proposed development scenarios will be realized. Only Mineral Reserves have demonstrated economic viability under NI 43-101 guidelines.
1
Sustaining costs also includes Mobilization and reinstalment of the modular processing facility from the Barani to the Gourbassi Deposit
2025 SMSZ Updated Preliminary Economic Assessment (PEA) Highlights
(Barani & Gourbassi Combined)
Production
Mine Life (years)
10.0
Total Gold Production (oz)
130,700
Average Annual Gold production (oz)
11,400
Total mineralized mine (kt)
4,239
Total waste mined (kt)
11,040
Total material mined (kt)
15,278
Total waste-to mineralization ratio
2.60
Average gold grade (g/t)
0.96
Gold process recovery (%)
87
Average Process Plant Throughput (ktpm)
36
Operating Costs
Mining costs per tonne (Total Material)
$2.80
Mining cost per tonne (Mineralization)
$2.96
Mining cost per tonne processed
$10.10
G&A cost per tonne processed
$5.80
Processing cost per tonne processed
$13.90
Total Cash cost per tonne processed
$29.70
Total Cash cost (per ounce sold)
$1,114
Mine site all in sustaining cost (per ounce sold)
$1,137
Capital Costs
Initial Capital Expenditure (Initial Capex)
$20.4 M
Sustaining Capital Expenditures
1
$15.8 M
Net Reclamation costs (cost less salvage value)
$0
Total Capital Expenditure - Life of Mine
$36.5 M
Total Capital Expenditure (per ounce sold)- life of mine
$323/oz
Base Case Economic Assessment: $2,850/oz Gold Price
IRR (after tax)
57%
NPV @0% Discount rate (millions, after tax)
$126 M
NPV @10% Discount Rate (millions, after tax)
$61 M
Payback (years)
2.50
Economic Assessment: $4,070/oz Gold Price (as of Nov.24, 2025)
IRR (after tax)
101%
NPV@0% Discount Rate (millions, after tax)
236 M
NPV @10% Discount Rate (millions, after tax)
124 M
Financial Analysis and Sensitivities
The SMSZ Project is expected to generate a total after-tax free cash flow of $126 million, averaging
about $12.6 million per year over the 10.0-year mine life. Cash flow is generally steady across the life of
the project, with a slight dip expected during the transition between mining at Barani and Gourbassi. This
reflects the planned relocation and commissioning of the modular processing plant and is already
accounted for in the overall schedule and financials.
Figure 1:
After-tax Cash Flow over Life of Mine for both Barani and Gourbassi West and East
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/4954/275838_236c51367406ba69_001full.jpg
The SMSZ Project demonstrates strong leverage to gold price, as illustrated in the sensitivity analysis
presented in Table 2. With the gold market on a continuously increasing, a new base case scenario of
US$2,850 per ounce has been completed. The Project yields an after-tax NPV (10%) of US$61 million
and an after-tax IRR of 57%. At a higher gold price of US$3,350 per ounce, the after-tax NPV increases
to US$87 million with an IRR of 76%. These sensitivities are presented for illustrative purposes only and
assume all other parameters remain constant.
Table 2
: PEA Sensitivities to Gold Price, Operating Costs (OPEX) and Capital Costs (CAPEX)
*$4,070 is the spot gold price as of Nov. 24
th
, 2025
Gold Price Sensitivity
Range
Gold Price
After Tax NPV (10%) ($M)
IRR
Payback (months)
-18%
$2,350
36
39%
44
-11%
$2,550
46
46%
40
-4%
$2,750
56
54%
31
0
$2,850
61
57%
30
4%
$2,950
66
61%
30
11%
$3,150
77
68%
29
18%
$3,350
87
76%
28
43%
$4,070*
124
101%
25
OPEX Sensitivity
Range
OPEX ($/t)
After Tax NPV (10%) ($M)
IRR
Payback (months)
-15%
25
70
64%
29
-10%
27
67
62%
30
-5%
28
64
60%
30
0
30
61
57%
30
5%
31
58
55%
31
10%
33
55
53%
32
15%
34
52
51%
32
CAPEX Sensitivity
Range
CAPEX ($)
After Tax NPV (10%) ($M)
IRR
Payback (months)
-15%
28.8
65
68%
29
-10%
30.5
64
64%
29
-5%
32.2
62
61%
30
0
33.9
61
57%
30
5%
35.6
60
55%
31
10%
37.3
59
52%
32
15%
39.0
58
50%
32
Gold Production
Average annual gold production over the life of mine is estimated at 11,300 ounces (or ~942 ounces per
month), with total payable gold production projected at approximately 113,100 ounces across both the
Barani and Gourbassi deposits.
Figure 2.
Production Profile for both Barani and Gourbassi based on months
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/4954/275838_236c51367406ba69_002full.jpg
Capital Costs
The initial capital cost is estimated at approximately $20 million, with sustaining capital over the life of
mine projected at $16 million. Contingencies of 20% have been applied to the direct capital costs.
These estimates are grounded in current pricing data, including vendor quotes from regional suppliers,
and benchmarked against cost structures from comparable West African gold operations.
Initial capital is largely directed toward developing the Barani East deposit, including installation of the
modular processing plant. Sustaining capital is allocated primarily to the relocation of that plant to the
Gourbassi site during the second phase of mining. By utilizing a modular plant that can be redeployed
rather than duplicated, Desert Gold has significantly reduced upfront capital costs. This staged approach
helps control early expenditures and avoids unnecessary infrastructure overlap. A breakdown of the
initial capital estimate, totaling US$20 million, is provided in Table 2.
Table 2.
Summary of Initial and Sustaining Capital Costs
Initial Capital
Item
Cost ($USD)
Process plant mobilization, construction, and relocation
$4.6 million
Tailings and water management facilities
$3.5 million
Power and Water infrastructure
$3.2 million
Site access, civil works, and mine establishment
$1.2 million
Fleet, camp, and support services
$1.2 million
Indirect Capital and Owner's costs
$3.4 million
Contingency (20%)
$3.4 million
Sustaining Capital
Item
Cost ($USD)
Process plant mobilization, construction, and relocation
$0.1 million
Tailings and water management facilities
$6.9 million
Power and Water infrastructure
$1 million
Site access, civil works, and mine establishment
$1.2 million
Indirect Capital and Owner's costs
$1.8 million
Contingency (20%)
$2.2 million
Ongoing equipment maintenance and renewals
$2.6 million
Cash Costs
Total cash costs for the SMSZ Project are estimated at $29.70 per tonne processed, or $1,114/oz of
payable gold. The all-in sustaining cost (AISC) is estimated at $1,137/oz.
These operating costs reflect
the use of modular infrastructure, low strip ratios at Gourbassi, and owner-operated mining, which
collectively contribute to lower per-tonne costs compared to regional peers. The all-in cost (including
capital) is estimated at $1,437/oz of payable gold.
Cost estimates were derived from vendor quotations, current fuel and labor assumptions in Mali, and
benchmarking against similar oxide gold operations across West Africa.
Table 3
. Total Cash Costs for Both Barani and Gourbassi Deposits
Total Cash Costs
Cost Item
Cost ($USD)
Mining Cost (per tonne processed)
$10.10
Processing Cost (per tonne processed)
$13.90
G&A Cost (per tonne processed)
$5.80
Total Cost (per tonne processed)
$29.70
Royalties and Other (per tonne processed)
$0
Total Cash Cost (per ounce sold)
$1,114
Mineral Resource Estimate
The current Preliminary Economic Assessment (PEA) for Desert Gold's SMSZ Project focuses
exclusively on oxide and transitional mineralization within optimized open pits at the Barani East, Barani
Gap, Gourbassi West, Gourbassi West North, and Gourbassi East deposits. These four zones
collectively contribute approximately 130,700 ounces of gold to the mine plan (after mining modifying
factors), with an average recovered grade of 0.96 g/t Au and a projected gold recovery of 87% via
conventional CIL processing, equating to roughly 113,100 ounces of recoverable gold.
Importantly, the study excludes some of the smaller pits identified during the PEA which may offer
additional upside in future technical work. Furthermore, the current cutoff grade for reporting the Mineral
Resource Estimate (MRE) is 0.2 g/t Au.
The total Measured and Indicated (M&I) Resources now stand at 11.12 Mt grading 0.94 g/t Au for
336,800 ounces, while Inferred Resources total 27.16 Mt grading 1.01 g/t Au for 879,900 ounces. The
total ounces reflect the oxide, transition and sulfide/fresh mineralization for the SMSZ Project. The PEA
only focused on the oxide and transitional material and therefore the PEA pits were optimized on the
oxide and transition material. The exclusion of the sulfides, which contribute ~45% to the MRE at Barani
and Gourbassi, would also result in less oxide and transitional material being include in the PEA pits.
The highlighted deposits in table 4: Gourbassi West, Gourbassi West North, Gourbassi East, Barani
Gap, and Barani East, contribute ~ 648koz of oxide, transitional and fresh mineralized material to the
MRE. The oxide and transitional mineralized material for these five areas is ~285,000 oz Au.
Key exploration targets such as Mogoyafara South, Linnguekoto West, and the Keniegoulou area were
not included in the current PEA, though they collectively host substantial Inferred Resources and
represent clear upside for future expansion. In total, over 1 million ounces of gold remain outside of the
current PEA pit shells (resources which are deeper, narrower, or require higher strip ratios) and could be
integrated into subsequent development scenarios pending additional drilling and studies.
Figure 3:
Gourbassi East PEA pit design
To view an enhanced version of this graphic, please visit:
https://images.newsfilecorp.com/files/4954/275838_236c51367406ba69_003full.jpg
Table 4
. Total Mineral Resource Update for SMSZ Project
**Only the highlighted resource blocks, specifically those within the Gourbassi West, Gourbassi West North, Gourbassi East, Barani Gap and Barani
East oxide/transitional zones, are incorporated into the current PEA mine plan. All other resources, including sulfide material and smaller or deeper
pits, are excluded from the economic analysis at this current stage.
Mineral
Resource
Category
Project
Project Sub
Division
Tonnes (In Situ)
Gold Grade
Gold Content
Mt
g/t
kg
oz
Measured
Gourbassi
Gourbassi West
2.46
0.78
1,920
61,600
Barani
Barani East
0.68
2
1,360
43,900
Total Measured
3.14
1.05
3,280
105,500
Indicated
Gourbassi
Gourbassi East
2.72
1.06
2,880
92,600
Gourbassi West
4.28
0.65
2,790
89,700
Barani
Barani East
0.98
1.56
1,520
49,000
Total Indicated
7.98
0.9
7,190
231,300
Total M&I
11.12
0.94
10,470
336,800
Inferred
Mogoyafara
Mogoyafara South
14.33
0.97
13,920
447,500
Linnguekoto
Linnguekoto West
1.47
1.42
2,080
67,000
Gourbassi
Gourbassi East
2.22
1.21
2,670
86,000
Gourbassi West
3.46
0.75
2,610
83,800
Gourbassi West
North
2.45
0.72
1,760
56,500
Barani
Barani East
1.24
1.38
1,710
55,100
Barani Gap
1.07
0.88
940
30,200
Keniegoulou
0.46
2.4
1,090
35,200
KE
0.47
1.23
580
18,600
Total Inferred
27.16
1.01
27,370
879,900
Notes:
1
.
Cut off grade applied at 0.2 g/t
2
.
No Geological loss has been applied
3
.
This resource is redrived from the base case study using $2,850/oz
4
.
Mineral Resources are stated inclusive of Mineral Reserves
5
.
Mineral Resources are reported as total Mineral Resources and are not attributed
6
.
Columns might not add up due to rounding
7
.
Inferred Mineral Resources have a low level of confidence and while it would be reasonable to expect that the majority of the inferred
Mineral Resources would upgrade to Indicated with continued exploration, due the uncertainty of the Inferred Mineral Resources, it should
not be assumed that such upgrading will occur
Mining
The SMSZ Project is located within gently undulating terrain in southwestern Mali. The regional
topography, semi-arid climate, and established infrastructure are well suited to conventional open-pit
mining methods, with no underground mining planned at this stage. The current PEA targets shallow
oxide and transitional material from the Barani East, Gourbassi West, Gourbassi West North, and
Gourbassi East deposits. While deeper sulfide mineralization exists beneath these pits, it has not been
considered in the current mine plan but may be evaluated in future technical studies.
Mining operations will consist of three independent open pits; each developed in pushback phases. Pit
slopes are designed using a combination of 25° inter-ramp angles in saprolite and 44° angles in
transition and fresh rock, based on geotechnical criteria and material strength observed in pit
optimization work. Given the dominance of oxide and transition ore, significant portions of the material
(especially in the upper benches) are expected to be free-digging, requiring minimal to no blasting.
To maintain mining selectivity and limit dilution, ore zones will be mined using 5 m high benches with a
fleet of medium-sized hydraulic excavators (~5 m³) and 35-40 t haul trucks. Waste rock and deeper
transitional material will be mined on 10 m benches using larger drills and excavators, supported by
conventional blast patterns where necessary. Mining will be conducted by owner-operated fleets, with
supporting equipment such as dozers, water trucks, graders, and light vehicles deployed across each
pit.
The open-pit operation is designed to deliver an average of 1,200 tonnes per day (tpd) of mineralized
material, split between Barani and Gourbassi in two staged campaigns. Peak material movement
across pits is expected to reach ~12,000 tpd total when accounting for waste rock at Barani and a
maximum of ~5,400tpd at Gourbassi.
A total of approximately 11Mt of waste rock and 4.24 Mt of ore are planned to be mined over the 10-year
mine life, yielding a life-of-mine strip ratio of 2.60:1. The mined ore has an average grade of 0.96 g/t Au,
and metallurgical testing indicates a process recovery of 87%, resulting in an estimated 113,100 oz of
recovered gold. (Subsequent to the application of mining conversion factors)
Ore will be either fed directly to the modular CIL process plant or temporarily stockpiled for blending.
Waste rock will be transported to designated waste rock dumps or used in the construction of tailings
embankments and haul roads as required.
The following table shows the Mineral Resources in the PEA pits. The Pits were only optimized on oxide
and transitional mineralized material. Fresh mineralized material was excluded during the pit
optimization process resulting in only 1% sulfide mineralized material in the Gourbassi PEA pits and
none in the Barani PEA pits.
Table 6.
Mineral Resources within the Barani and Gourbassi designed pits.
Pit Area
Mineral Resource Classification
Tonnage
Grade
Content
kt
(g/t)
(koz)
Barani
Measured
148
2.42
11.5
Indicated
43
1.91
2.7
Inferred
339
1.58
17.3
Grand Total
Total
530
1.84
31.4
Notes:
1
.
This is Mineral Resources only in the PEA designed pits
2
.
No Mining Conversion factors have been applied to the tonnes, grade and content in this Table
3
.
No Mineral Reserves is stated in the PEA
Pit Area
Mineral Resource Classification
Tonnage
Grade
Content
kt
(g/t)
(koz)
Gourbassi West &West North
Measured
1,289
0.92
38.1
Indicated
377
0.86
10.4
Inferred
1,452
0.93
43.2
Grand Total
Total
3,117
0.92
91.8
Notes:
1
.
This is Mineral Resources only in the PEA designed pits
2
.
No Mining Conversion factors have been applied to the tonnes, grade and content in this Table
3
.
No Mineral Reserves is stated in the PEA
Pit Area
Mineral Resource Classification
Tonnage
Grade
Content
kt
(g/t)
(koz)
Gourbassi East
Measured
-
-
-
Indicated
291
1.13
10.6