Meridian Mining's definitive feasibility study values its Cabaçal gold-copper project in Brazil at $2.09 billion after tax, with a 108% IRR and 0.9-year payback -- more than double its 2025 pre-feasibility estimate.
At a glance
- After-tax NPV5 of US$2.09 billion at a 5% discount rate, more than double the 2025 pre-feasibility study's US$984 million.
- 108% after-tax IRR and a 0.9-year payback period, against US$322 million of initial capital net of tax credits -- a 6.5x NPV-to-capex ratio.
- 13.9-year mine life producing a total of 983,537 ounces of gold, 180,634 tonnes of copper and 1,779,720 ounces of silver.
- Life-of-mine average annual production of 112,900 gold-equivalent ounces, rising to 183,526 ounces a year in the first five years.
What happened
Meridian Mining released the results of its definitive feasibility study for the Cabaçal gold-copper-silver project in Mato Grosso, Brazil on September 22, 2026, reporting an after-tax net present value of US$2.09 billion at a 5% discount rate. The study puts the after-tax internal rate of return at 108% and a payback period of just 0.9 years, against an initial capital cost of US$322 million net of tax credits -- an NPV-to-capex ratio of 6.5 times. That marks more than a doubling of the US$984 million NPV5 the company's 2025 pre-feasibility study had reported, at a similarly steep 61.2% IRR. Cabaçal sits roughly 320km west-northwest of Cuiabá, the capital of Mato Grosso state, and is designed as a conventional open-pit mine feeding a mill and process plant over a 13.9-year mine life. CEO Gilbert Clark said the study "delivered a NPV5 exceeding two billion dollars, an IRR over one hundred percent and a payback of less than one year."
The details
The roughly 112% jump in project value from the 2025 pre-feasibility study to this definitive feasibility study is unusually large for a single study upgrade, and it traces mainly to two things: an updated, more favorable metal-price deck used in the DFS's base case, and engineering refinements that came with the more detailed definitive-level study, including firmer capital and operating cost estimates from Ausenco, the engineering firm that led the work. A 6.5x NPV-to-capex ratio is a strikingly high figure for a conventional open-pit gold-copper project -- most projects of this type in the current market fall well under 2x -- and it reflects Cabaçal's combination of a modest initial capital bill (US$322 million) against a large, long-life, high-margin production base spread over nearly 14 years.
The front-loaded production profile is a key part of the economics: years 1-5 average 183,526 gold-equivalent ounces annually at an AISC of just US$715/oz, well above and below (respectively) the life-of-mine averages of 112,900 ounces and US$1,056/oz. That pattern is typical of open-pit sequencing, where higher-grade, lower-strip-ratio ore near surface gets mined first, generating strong early cash flow that funds the 0.9-year payback before the mine transitions to lower-grade material later in its life. Meridian isn't waiting for financing to line up before moving: preconstruction investments of US$15.9 million are already committed, an installation licence application has been lodged, a power line licence is approved, and the company says it has engaged more than 30 lending groups while collecting EPCM (engineering, procurement and construction management) contract proposals -- signs the DFS is meant to be a financing document as much as a study, aimed at converting a strong set of numbers into an actual construction decision.
Why it matters
A 13.9-year mine producing gold, copper and silver together gives Cabaçal exposure to two separate demand stories at once -- gold's role as a monetary and investment asset, and copper's role in electrification and grid infrastructure -- reducing the project's reliance on any single metal's price cycle. Brazil has become an increasingly active jurisdiction for new gold-copper development in the current cycle, and a project clearing this study stage with reserve-backed numbers this strong could accelerate financing and construction relative to peers still working through earlier study stages.
Our read
Outlook: neutral. Cabaçal remains pre-construction, so this feasibility study milestone has no near-term effect on spot gold or copper prices. Its relevance is to project financing and Meridian's own valuation, and to Brazil's growing pipeline of gold-copper development projects, rather than to current global supply-demand balances.
What to watch
- Progress toward closing project financing among the 30+ lending groups engaged
- Installation licence approval outcome
- EPCM contractor selection and final construction cost lock-in
- Gold and copper price trends relative to the DFS's base-case price assumptions
For information only, not investment advice.
Gold price in India
metalscost.com India reference price as of 2026-10-03.
Detailed analysis
Timeline
- 2026-09-22: Meridian Mining releases its definitive feasibility study for Cabaçal, reporting a US$2.09 billion after-tax NPV5, 108% IRR and 0.9-year payback.
Supply Drivers
Cabaçal would add a 13.9-year source of gold, copper and silver production in Brazil, with total planned output of 983,537 ounces of gold and 180,634 tonnes of copper over the mine life -- a meaningful new supply source once financed and built, though construction has not yet begun.
Mining Production
The DFS outlines a conventional open-pit mine, mill and process plant with a 13.9-year life, averaging 112,900 gold-equivalent ounces annually (183,526 oz/year in the first five years), at a life-of-mine AISC of US$1,056/oz gold-equivalent.
What could lift prices
- NPV more than doubled from the 2025 pre-feasibility study to US$2.09 billion, with IRR rising from 61.2% to 108%.
- A 6.5x NPV-to-capex ratio and a sub-one-year payback are exceptionally strong for a conventional open-pit project.
- Preconstruction already underway: US$15.9 million committed, installation licence application lodged, and EPCM contract proposals being collected.
- Dual gold-copper-silver revenue base reduces reliance on any single metal's price cycle.
What could weigh on prices
- Construction financing is not yet secured -- the company describes engaging '30+ lending groups' but no financing package has closed.
- Life-of-mine average grades and output (112,900 AuEq oz/year, US$1,056/oz AISC) are meaningfully weaker than the front-loaded years 1-5 figures, so the project's best economics are concentrated early in the mine life.
Country impact
| Country | Impact | Reason |
|---|---|---|
| Brazil | High | Hosts the Cabaçal project in Mato Grosso state; preconstruction investment of US$15.9 million is already committed and an installation licence application has been lodged, with construction jobs and royalties to follow a build decision. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Construction | Positive | Cabaçal's planned copper production, once in operation, would add supply for a metal central to electrical wiring, construction and grid infrastructure demand. |
Who gains, who loses
- Meridian Mining shareholders: Sharply higher project value and strong payback economics support the case for securing lower-cost project financing.
- Mato Grosso state and local communities: Construction jobs, training programs with SENAI MT, and royalty revenue would follow once the project moves to construction and production.
- Other early-stage Brazilian gold-copper developers: Cabaçal's strong DFS economics could make it more competitive for the limited pool of project financing and EPCM contractor capacity in the region, at the margin.
Other ways this could play out
- If Meridian secures project financing on favorable terms given the strong DFS metrics, construction could begin sooner than typical for a project at this stage.
- A pullback in gold or copper prices from the levels assumed in the DFS's base case could compress the reported NPV and IRR, since both were calculated using specific price assumptions embedded in the base case.
Price risks
- The DFS's NPV and IRR are calculated against specific gold and copper price assumptions in its base case; a sustained pullback in either metal's price would reduce the reported economics.
- Financing has not yet closed -- delays in securing the roughly US$322 million of initial capital could push back the construction timeline.
Historical comparison
- 2025 Pre-Feasibility Study: Meridian's 2025 PFS for Cabaçal reported an after-tax NPV5 of US$984 million and a 61.2% IRR, with average annual production of about 141,000 gold-equivalent ounces. The definitive feasibility study more than doubles that NPV to US$2.09 billion and lifts the IRR to 108%, reflecting updated price assumptions and more detailed, reserve-backed engineering.
Technical view
Price is trading below both its 20-period and 50-period moving averages, a bearish alignment.
Computed from metalscost.com's own stored price history.
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