Alamos steps out at Island Gold

The latest exploration release from Alamos Gold’s Island Gold mine suggests presence of high-grade mineralization up to 200 metres outside of the current resource limits. The company reported intercepts from three gold-bearing zones below and to the east of existing mine workings.

Drill highlights include:

  • 3.81 metres of 121.32 g/t gold and 2.57 metres of 108.17 g/t gold from down-plunge of the main extension of the Island Gold mineralization. These intercepts are up to 80 metres east of current resources and represent a 50-metre step out of the latest mineralized traces;
  • 9.01 metres of 21.28 g/t gold and 4.38 metres of 28.5 g/t gold from a new mineralized area between the main and eastern extensions of the Island Gold orebody which has been traced over 350 metres of strike and for 300 vertical metres; and
  • 4.68 metres of 32.19 g/t gold and 3.24 metres of 20.18 g/t gold from the eastern extension of the deposit which is located above this new zone. These intersections are 170 metres to the east of latest resources.

Based on the continuity of mineralization and the density of drill intercepts, Alamos expects to estimate an inferred resource for the new zone. The year-end resource and reserve update for the asset is expected in February.

“We had another exceptional year at Island Gold, operationally, financially and through the drill bit,” said John McCluskey, the company’s president and CEO, in a release. “We expect further growth in Island Gold’s mineral reserves and resources with our year-end update. This growth will be incorporated into the phase III expansion study which we plan to complete during the second quarter of 2020.”

Last year, the underground mine produced 150,400 oz. of gold, a new record for the asset. In September 2018, Alamos completed the first mill expansion, to 1,100 t/d, and received a permit for a second build-out, to 1,200 t/d, in May of 2019. The study evaluating a third expansion is expected in the first half of this year.

The total exploration budget for Island Gold this year stands at C$21 million, for both surface and underground exploration. The company plans to continue testing the continuity of the new mineralized zone between the main and eastern extensions of the Island Gold orebody.

Current proven and probable reserves for Island Gold currently total 3 million tonnes grading 10.28 g/t gold for a total of 1 million oz.

(This article first appeared in the Canadian Mining Journal)

Eldorado discovers new zone at Lamaque

Eldorado Gold has announced the discovery of a new zone of gold mineralization, the Ormaque zone, at its Lamaque gold operations. Drill highlights include:

  • 27.3 metres of 10.2 g/t gold;
  • 12.3 metres of 26.82 g/t gold; and
  • 16.25 metres of 25.53 g/t gold.

The Ormaque zone is located within a previously-undrilled gap in mineralization between the historic Sigma deposit and the Triangle deposit being mined currently.  The zone is in close proximity to the proprosed ramp which would link the Triangle underground mine to the Sigma mill.

The Lamaque mine achieved commercial production at the end of March; last year the asset produced a total of 113,940 oz.

In the latter half of last year, Eldorado completed 13 drill holes over an area of 250 metres by 300 metres; assays for seven have now been received. The drilling completed thus far has traced mineralized zones at depth of 200 metres to 500 metres below surface; Ormaque remains open and drilling is ongoing.

The Lamaque mine achieved commercial production at the end of March; last year the asset produced a total of 113,940 oz. of gold with the company currently evaluating a 50% expansion of the mill to 2,500 t/d. The release of an associated preliminary economic assessment has been delayed to incorporate Ormaque in the study.

The report is expected to outline three potential projects to boost production: Sigma mill upgrades, development of a decline from the mill to the Triangle deposit and construction of a paste plant to provide a tailings disposal solution.

In December, Eldorado closed two transactions that increase its eastern Abitibi holdings: it invested C$4 million in QMX Gold and now holds a 19.99% stake in the company and executed an option agreement with Sparton Resources to earn up to a 75% initial interest in the Bruell project, 35 km east of Lamaque.

“The discovery of the Ormaque zone further confirms the geological prospectivity of our property and the tremendous potential we see at Lamaque,” George Burns, Eldorado’s president and CEO said in a release. “Additionally, the transactions demonstrate our commitment to growing our asset base in Quebec and increasing our exposure to early-stage exploration in the eastern Abitibi.”

Eldorado acquired a 100% interest in the Lamaque operations in July 2017 and poured first gold from the project in December 2018.

(This article first appeared in the Canadian Mining Journal)

Taskeo finalizes development plan for Yellowhead copper project

Taseko Mines has completed a new development plan and updated study for its Yellowhead copper project, 150 km northeast of Kamloops, British Columbia, adding 100 million tonnes to reserves and improving the economics.

A new technical report pegs pre-production capital costs for an operation with a 25-year mine life at Yellowhead at C$1.3 billion. At an 8% discount rate, the project has a pre-tax net present value (NPV) of C$1.3 billion and an internal rate of return (IRR) of 18%.

The project contains updated reserves of 817 million tonnes grading 0.29% copper equivalent (or 0.28% copper, 0.03 g/t gold and 1.3 g/t silver). The study used a long-term metal price of $3.10 per lb. copper and a $0.80 exchange rate.

“The leverage this mine has to metal prices is huge”

Taseko CEO

In a release, Taseko CEO Russell Hallbauer noted that the updated report improves NPV by C$500 million over a 2014 feasibility study completed by the project’s previous owner, Yellowhead Mining.

“The optimizations and modifications we have made are not only beneficial to the economics of the project but will also improve it from an environmental assessment process standpoint,” Hallbauer said. “The leverage this mine has to metal prices is huge, and with only a 10% increase in these assumptions, the pre-tax NPV climbs to C$2 billion.”

The company now plans a 90,000 t/d operation, up from 70,000 t/d. The new technical report also features an improved water management plan that reduces stored water by 90%.

“While our primary and near-term focus will remain on the advancement of our Florence copper project through to production, we will continue to progress Yellowhead expeditiously as the timing will fit in ideally after Florence copper achieves commercial production,” Hallbauer said. “With the new technical report now complete, our efforts will focus on environmental assessment work, ongoing engagement with local communities.”

Taseko also owns the operating Gibraltar mine and is advancing the Florence copper project in Arizona. In December, it announced it was in talks with the Tsilhqot’in First Nation, mediated by the province, regarding its New Prosperity project in B.C.

Taseko acquired Yellowhead in 2014 in an all-stock transaction valued at C$13 million.

(This article first appeared in the Canadian Mining Journal)

Yamana beats production guidance

Yamana Gold has released 2019 production results with 1.02 million of gold-equivalent oz. slightly exceeding the company’s guidance for 1.01 gold-equivalent oz. Three underground mines in South America: Jacobina, El Penon and Minera Florida appear as outperformers last year.

The company’s biggest production contribution is from its 50% stake in the Canadian Malarctic open pit in Quebec which produced 334,596 oz. last year, in line with expectations.

For Minera Florida in Chile, December, in particular, was a standout month with over 50% more ounces produced than its monthly average. The mine produced a total of 73,617 oz. in 2019; Yamana believes that the mine may be able to support higher production this year.

The company will provide costs with its full financial results and guidance release in mid-February; latest all-in sustaining costs guidance was for $920 to $960 for the year.

(This article first appeared in the Canadian Mining Journal)

Frist Cobalt upgrades Iron Creek resource

First Cobalt has released an updated resource for its 7 sq. km Iron Creek project with 2.2 million tonnes at 0.32% cobalt-equivalent in the indicated category and 2.7 million tonnes at 0.28% cobalt-equivalent in the inferred category. Contained cobalt stands at 12.3 million lb. in the indicated and 12.7 million lb. in the inferred category.

This represents a 10% growth in total tonnes, at relatively consistent grades, when compared with the maiden inferred resource, released in 2018, of 4.4 million tonnes at 0.3% cobalt-equivalent.

Drilling to date has traced mineralization over 900 metres of strike and for 650 metres down-dip

“Results of the infill drilling campaign exceeded our expectations and confirm that we have a continuous deposit,” Trent Mell, First Cobalt’s president and CEO said in a release. “Future work will include drilling along strike and at depth to add tonnes as well as geophysical surveys to understand the potential of other nearby targets, including the Ruby zone.”

The most recent resource report suggests that underground mining would be optimal for the deposit as drilling has traced mineralized extensions down-dip. The 2018 report outlined a combined open-pit and underground scenario.

Drilling to date has traced mineralization over 900 metres of strike and for 650 metres down-dip; it remains open on strike and down-dip.

The company’s main focus for this year will be the recommissioning of its First Cobalt Refinery in Ontario. Two feasibility studies are expected before the end of the first quarter with a possible restart by the fourth quarter.

(This article first appeared in the Canadian Mining Journal)

Wesdome sets production guidance for 2020

Gold miner Wesdome (TSE: WDO) has issued production guidance of 90,000 oz. to 100,000 oz. for this year; last year’s production of 91,688 oz. was in line with prior guidance for 88,000 oz. to 93,000 oz.

The bulk of the company’s current production is from its Eagle River underground mine near Wawa. Output from this asset has been steadily increasing, with 88,617 oz. produced last year, compared to 67,315 oz. and 50,996 oz. contributed in 2018 and 2017 respectively. This year, Wesdome is forecasting 87,000 oz. to 96,000 oz. from the mine.

Upon positive results, it will start a pre-feasibility study of the operation

The company plans to continue with underground exploration and development at Eagle River to generate higher-grade feed for the mill. The most recent all-in sustaining cost guidance for 2019 was at $985 to $1,040 per oz. with no changes to these figures expected this year.

The Eagle River complex also includes the Mishi open pit which is currently Wesdome’s only other gold contributor.

Wesdome also holds the Kiena past-producing underground mine in Quebec. Work is ongoing on a preliminary economic assessment for this asset with results expected in the first half of the year. Drilling, drifting and ramp development are ongoing as the company prepares for a potential restart of the mine. Upon positive results, it will start a pre-feasibility study of the operation.

This year’s capital budget for Kiena stands at C$44.8 million which includes both exploration and mine development, based on a go-forward scenario. A further C$14 million to C$17 million is allocated for capital development at Eagle River and C$9.8 million is planned for exploration. Wesdome started this year with C$35.7 million in cash and equivalents and C$41.5 million available in a credit facility.

(This article first appeared in the Canadian Mining Journal)

RCT launches specialized underground WiFi network

Autonomous solutions specialist RCT has released RCT Connect, the first digital WiFi communications network designed specifically for machine automation and control in underground mining operations.

The product is designed to be user friendly and portable and can be installed into a production area and commissioned with minimal time and expertise.

RCT Connect has been designed to withstand the harsh conditions common in underground mining environments. The platform uses a coaxial cable which is able to transfer power and information to access points for up to 1.5 km before additional power insertion is required along the length of a drive.

This feature offers several major benefits over traditional WiFi deployments; these include reduced configuration requirements and a simple installation with only two connections.

RCT Connect provides a connection to a ControlMaster area access control at strategic locations which then link into the mine-wide backbone to transfer information to a machine operator located in a ControlMaster automation centre on surface.

The platform operates at 2.4GHz and is capable of carrying out remote diagnostics, live machine tracking and delivering live health and production data from the machine.

RCT product manager, automation and control, Brendon Cullen says RCT Connect offers several distinct advantages over commercially available digital communication networks: “RCT Connect is specifically designed to ensure uninterrupted communication between the machine and the operator regardless of location,” he said. “The platform has very stable performance with low, consistent latency and so ensures reliable communications between command inputs from the surface station and subsequent machine activities.”

The network has been tested at a mine site in Western Australia and was recently deployed in an underground mining operation.

RCT Connect can be sold as a standalone package or in conjunction with RCT’s ControlMaster automation products.

RCT is an innovative smart technology company with the expertise to evolve entire industries. It designs, manufactures and delivers technology and service solutions to support clients around the world in multiple sectors. RCT is a global leader in smart guidance, teleremote and remote control automation solutions for the mining industry.

(This article first appeared in the Canadian Mining Journal)

Skeena’s stock up after releasing Eskay Creek results

Skeena Resources (TSX: SKE.V) on Tuesday released infill results from its flagship Eskay Creek project in British Columbia’s Golden Triangle, with some intercepts returning above-resource grades.

Drill highlights include:

  • 36.9 metres of 14.73 g/t gold-equivalent;
  • 37.9 metres of 8.53 g/t gold-equivalent; and
  • 18.5 metres of 9.02 g/t gold-equivalent.

Current resources for Eskay Creek stand at 13.5 million tonnes in the indicated category grading 6.1 g/t gold-equivalent for a total of 2.7 million oz. and an additional 13.9 million inferred tonnes at 2.9 g/t gold-equivalent for a total of 1.3 million oz. The majority of these resources are pit-constrained.

In November, the Vancouver-based miner published the results of a preliminary economic assessment (PEA) for Eskay. The mine would produce an average of 306,000 gold-equivalent oz. annually at all-in sustaining costs of $757 per oz. The associated net present value estimate, at a 5% discount rate, is C$638 million.

Eskay Creek produced 3.3 million oz. of gold and 160 million oz. of silver between 1994 and 2008.

At market close Tuesday, Skeena’s stock was up over 11%, with trading volume more than double the daily average. The company has a C$117 million market capitalization.

(A version of this article first appeared in the Canadian Mining Journal)

Corvus finds more gold at Mother Lode

Corvus Gold has released drill results from its Mother Lode project which intercepted mineralization outside of the resource limits and identified a new discovery below the current deposit.

Drill highlights include:

  • 36.6 metres of 2.43 g/t gold from outside of the current resource limits;
  • 36.6 metres of 1.79 g/t gold from outside of the current resource limits; and
  • 42.1 metres of 1.6 g/t gold from below the Mother Lode deposit.

The area of mineralization below Mother Lode, called the Central Intrusive zone, features higher-grade oxide mineralization with additional follow-up drilling planned. Corvus expects the CIZ to potentially support both open pit and future underground mining. The company has interpreted a widening intrusive dike system at CIZ which projects downwards.

“The latest intercepts from the new CIZ are encouraging and we believe they could represent the tip of the iceberg for a new high-value part of this growing deposit,” Jeffery Pontius, the company’s president and CEO said in a release. “The phase-4 Mother Lode exploration program is designed to unlock what Corvus anticipates may be the deep potential for both high-grade oxide and deeper sulphide mineralization in this promising new sediment-hosted deposit.”

Current measured and indicated resources at the 36.5-sq.-km Mother Lode project stand at 53.4 million tonnes at 0.68 g/t gold for a total of 1.16 million oz. with additional inferred resources of 16.2 million tonnes at 0.46 g/t gold for a total of 241,000 oz; 52.2 million of these tonnes are in the heap leach category.

The company’s 91-sq.-km North Bullfrog project borders Mother Lode; both are located within the Bullfrog mining district host to epithermal gold systems. Mother Lode is a new discovery of a sediment-hosted gold system.

(This article first appeared in the Canadian Mining Journal)

Elmer delivers long, shallow intercepts for Azimut

Azimut Exploration’s first seven drill holes at its Elmer property in the James Bay region of Quebec have returned long intercepts of gold mineralization, including 102 metres of 3.15 g/t gold.

Highlights from the 996-metre drill campaign, which was conducted at the Patwon prospect at Elmer, include:

  • 108.2 metres of 2.84 g/t gold starting from 34 metres in hole 3 (intercept includes several shorter high-grade intervals including 4.7 metres of 27.36 g/t gold);
  • 102 metres of 3.15 g/t gold starting from 34 metres depth in hole 2 (intercept includes several higher-grade intervals including 9 metres of 5.15 g/t gold and 20.5 metres of 10.1 g/t gold); and
  • 97 metres of 1.68 g/t gold from 5 metres depth in hole 4 (including 15.5 metres of 4.16 g/t gold, 5.5 metres of 7.85 g/t gold and other high-grade intersections).

Azimut considers the intercepts the most significant gold exploration results in the James Bay region since the discovery of the Éléonore gold deposit in 2004. The Patwon prospect is part of a larger 7-km-long target zone at Elmer. The company is conducting an induced polarization geophysics survey in the discovery area in preparation for a more comprehensive drill program.

Azimut says the results show that gold-bearing mineralization occurs in veins in three different orientations. So far, mineralization has been traced over 200 metres with a width at surface of 50 to 70 metres, and to 100 metres depth, where it remains open.

The company staked the Elmer property and the adjacent Duxbury property based on its proprietary predictive gold modelling technology AZtechMine.

(This article first appeared in the Canadian Mining Journal)