Amex Exploration's Feasibility Study: Six-Month Payback and the Build-or-Buy Question
CEO.CA's Digging for Dollars dedicates its opening segment to Amex Exploration's new feasibility study: a stated $1.13 billion after-tax NPV at $3,500 gold, roughly six-month payback, $910 AISC and likely all-debt financing — balanced against a five-year mine life. The hosts own shares and frame the open question as build a mid-tier or get bought.
Investor angle
The transferable idea in this episode is the NPV-to-capex ratio the hosts apply to Amex — about 8 at spot and 5 at $3,500 gold — and treat, like payback period, as a proxy for financeability and speed. The second idea is accuracy: a feasibility study is engineered and bid out where a PEA can swing plus or minus 50%, so the hosts argue developer discounts narrow as estimates harden into studies. Toll milling and near-double grades are what keep Amex's capex near $200 million and margins wide enough that the hosts expect all-debt financing with minimal dilution. The same lens exposes the risk list: a five-year mine life, execution risk in an actual build, and a venture-listed junior whose roughly $500 million a year in projected cash flow could just as easily attract a buyer as fund a mid-tier strategy. Disclosure to weigh: the hosts state they own Amex shares and are not selling. All figures are the video's stated numbers, not Pixys's view.
Amex Exploration released its long-awaited feasibility study for the Peron gold project, and the April 14 episode of CEO.CA's Digging for Dollars devoted its entire opening segment to the numbers. The hosts' argument is simple: this study reads less like a promotional estimate and more like a business plan — a small capital bill, wide margins, and a payback measured in months. On their telling, it moves Amex into the small group of junior projects a company could actually build without repeatedly asking shareholders for money.
## The numbers the hosts highlight
- **After-tax NPV of $1.13 billion at $3,500 gold.** NPV (net present value — the project's value in today's dollars after all costs) uses a 5% discount rate here. The host cites roughly $1.7 billion at $4,700 gold, alongside a 150% IRR (internal rate of return — the project's annualized return on the capital invested). - **Initial capex of about $194 million**, which the host rounds to $200 million. Capex is the up-front money needed to build the mine. - **Production of roughly 147,000 ounces a year over a five-year mine life**, cited later as about 150,000 ounces at a $910 AISC (All-In Sustaining Cost — what it really costs to produce an ounce, including the spending that keeps the mine running). - **Payback in about six months at $3,500 gold and about five months at spot.** An uncle could loan the company the capex, the host jokes — the point being that the mine repays its build cost almost as soon as it starts.
## Why a feasibility study changes the conversation
The hosts draw a hard line between this document and the preliminary economic assessments (PEAs — early, rough sketches of a project's economics) that juniors usually trade on. A PEA, they argue, can be off by plus or minus 50%. A feasibility study carries engineering and actual contract bids, which makes it, in their words, "a now thing — something you can build right now." That matters for a show that has repeatedly argued developers trade at discounts to their stated net asset value: accuracy is what closes those discounts. The hosts expect lenders to feel the same, calling the build "probably all debt financing" with minimal dilution for shareholders.
## The ratio they keep coming back to
The number the host wants investors to watch is NPV-to-capex — a project's net present value divided by what it costs to build. On the study's numbers he puts it at about 8 at spot and about 5 at $3,500 gold, and the higher the ratio, the more doable and financeable the project. Two things keep Amex's denominator small, in the hosts' telling. A toll milling agreement — sending ore to an existing nearby mill rather than building processing infrastructure — sidesteps the cost overruns that have marked recent Canadian mine builds. And grades they describe as nearly double those of comparable projects keep the margins wide. Against a $1.13 billion after-tax NPV, the hosts frame the company's roughly $700 million market cap as exactly the kind of developer discount the show has been tracking, with the gap closing as estimates harden into engineering.
## The one big drawback: five years
The mine life in the study is five years. "Mines are holes in the ground, they're complicated, they go wrong," one host says, and the scale simply is not there. The hosts note the plan leaves roughly a million ounces in the ground beyond the study, with underground potential they expect to add more. That sets up the strategic question they leave open: with roughly $500 million a year in projected cash flow, does Amex use the mine to build itself into a mid-tier producer, or does a project this profitable get bought first? Their rule of thumb from the segment: projects a junior can build on its own are the ones that end up acquired.
## Positioning and disclosure
The hosts disclose they own Amex shares and are not selling — they are hanging on to see what the company does with the study. In the episode's rapid-fire quick-hits segment, they return to Amex as the reference point for why grade is king in Canadian gold: with grades this high, an explorer does not need much scale to build something worth having.
Generated by Pixys from the source video below. Not investment advice.
