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Details
The Kilgore project is caldera-related epithermal gold deposit with current Indicated Resource of 44.6 million tonnes at 0.58 g/t Au for 825,000 ounces Au and an Inferred Resource of 9.4 million tonnes at 0.45 g/t Au for 136,000 ounces Au. The property includes historical mine workings dating back to the early 1900s with further drilling in the 1980s that revealed the potential for mineralization well outside of the existing resource area, with limited follow up to date. Kilgore displays similar characteristics to Kinross Gold’s Round Mountain Mine, which has produced over 15 million ounces of gold to date.
In 2019 a preliminary economic assessment was completed that supports the potential for a low capital intensity, low operating cost, open-pit, heap-leach mining operation:
| ASSUMPTIONS | |
| Gold Price | $1,300/oz |
| PRODUCTION PROFILE | |
| Total Leach Tons Mined | 54.0 million |
| Total Waste Tons Mined | 60.0 million |
| Head Grade - Crushed | 0.72 g/T (0.02 opt) |
| Head Grade - ROM | 0.24 g/T (0.007 opt) |
| Mine Life | 5.0 years |
| Tons per Day Mined - Crushed | 15,000 tons per day |
| Tons per Day Mined - ROM | 15,300 tons per day |
| Strip Ratio (Waste:Mineralized Material) | 1.1:1 |
| Average Au Recovery – Crushed / ROM | 82% / 50% |
| Total Gold Ounces Mined | 752,200 |
| Total Gold Ounces Recovered | 558,700 |
| Average Annual Gold Production | 111,700 oz |
| Peak Annual Gold Production | 119,600 oz in year 1 |
| UNIT OPERATING COSTS | |
| Total Operating Cash Costs | $780/oz |
| All-In Sustaining Cost | $832/oz |
| KEY ECONOMIC MEASUREMENTS | |
| Royalties | 0% |
| Initial Cap-ex | $81 million |
| Pre-tax NPV5%/ After-tax NPV5% | $144.0 million/$110.4 million |
| Pre-tax IRR/ After-tax IRR | 40.6%/34.0% |
| Undiscounted Operating Pre-tax Cash Flow/ After-tax Cash Flow | $193.3 million/$151.8 million |
| After-tax Payback Period | 3.0 years |
| NPV | Discount Rate | |||
| 5.0% | 7.0% | 9.0% | ||
| Gold Prices USD/oz |
$1,100 | 32.4 | 23.2 | 15.1 |
| $1,300 | 110.4 | 96.8 | 84.6 | |
| $1,600 | 223.0 | 203.0 | 185.0 | |
| $1,800 | 299.6 | 275.1 | 252.9 | |
| $2,000 | 370.7 | 342.0 | 316.1 | |
| Gold Price / oz | |||||
| $1,100 | $1,300 | $1,600 | $1,800 | $2,000 | |
| Post-tax IRR | 13% | 34% | 63% | 81% | 98% |
Multiple opportunities exist to enhance the project, including significant exploration potential.
The Kilgore project is scalable in size and throughput and is open for expansion to the north, south and west. Opportunities for step-out drilling exist around the current area of mineralization. Immediately to the north of the deposit 16OKR-338 intersected 85.4 metres of 2.50 g/t Au near surface in the volcanic sequence, an area of the deposit that requires follow up along strike. Additionally, drilling has identified significant mineralization in the Aspen formation, a permeable sedimentary unit lying below the volcanic package that has seen minimal drilling with multiple holes ending in mineralization. Drill results from the Aspen formation include:
- 56.4 m of 2.05 g/t Au in 15OKR 304;
- 59.5 m of 3.79 g/t Au in 15OKR-305;
- 50.3 m of 4.24 g/t Au in 15OKR-308;
- 94.5 m of 4.21 g/t Au in 15OKR-309; and
- 30.5 m of 5.37 g/t Au in 16OKR-315.
Drilling at the Kilgore Project in 2021 will be performed under a Plan of Operations approved by the U.S. Forest Service. Results from this work will be incorporated into an updated resource estimate. Work is underway to improve understanding of the controls on high- grade mineralization and the underlying structural framework of the deposit. These are believed to represent the feeders of the mineralizing system, and to further define the receptive volcanic and sedimentary rock units that make up the bulk of the current resource. These units are open beyond the current resource.
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