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REGIONAL NEWS - U.S. & CANADA 8 E&MJ; • FEBRUARY 2018 www.e-mj.com ventional drill-blast-shovel operations, followed by six years of milling material from a low-grade ore stockpile. The min- ing rate will average 90 million tons per year, with 58 million tons of mineralized material going through the mill each year, for an extremely low life-of-mine waste to ore ratio of 0.1:1. Kirkland Lake Gold Sinking Major New Shaft at Macassa Kirkland Lake Gold will initiate sinking of a new shaft at its high-grade Macassa mine 580 km north of Toronto, Ontario, in 2018. The 21.5-ft-dia, concrete-lined, four-com- partment shaft will have total hoisting ca- pacity of 4,000 metric tons per day (mt/d) (ore and waste) and is an important com- ponent of the Kirkland Lake's plan to increase gold production at Macassa to more than 400,000 ounces per year (oz/y) over the next five to seven years. In 2017, Macassa processed 409,065 mt of ore at a head grade of 15.2 g/mt of gold and produced 194,237 oz of gold. The new shaft will provide a number of benefits for the Macassa mine, including de-risking the operation, enabling more effective underground exploration to the east of the mine's South Mine Complex, improving ventilation and general work- ing conditions in the mine, and support- ing higher levels of production and lower unit costs. Construction of the shaft will be com- pleted in two phases. Phase one will be to a depth of 5,450 ft and will include a mid-shaft loading pocket. Completion of this phase is targeted for the second quar- ter of 2022 at an estimated capital cost of $240 million, with approximately $40 million of expenditures planned for 2018. Phase two of shaft construction will be undertaken following the start of pro- duction from phase one and will involve extending the shaft to an ultimate depth of approximately 7,000 ft. Completion of phase two is targeted for the end of 2023 at an estimated capital cost of approxi- mately $80 million. Kirkland Lake also announced that its exploration expenditures in 2018 will be in the range of $75 million to $90 mil- lion, of which $60 million to $75 million is targeted for its Australian operations. Expenditures in Australia will focus on drilling and underground exploration de- velopment activities at the Fosterville mine in Victoria state and at the Cosmo mine in the Northern Territory. Kirkland Lake is planning lower levels of exploration spending in 2018 at its op- erations in Ontario, Canada. At Macassa, underground drilling will continue to fo- cus on resource replacement and expan- sion. Deep surface drilling at Macassa is being discontinued while the company sinks the new shaft, which will support more effective and efficient underground exploration programs going forward. Kirkland Lake is targeting compa- ny-wide gold production of more than 620,000 oz in 2018, up from 596,405 oz in 2017. Antofagasta Earning Into Evrim's Axe Property Evrim Resources and Antofagasta PLC have signed an agreement whereby An- tofagasta can acquire a 70% interest in Evrim's Axe property by incurring $50 million in exploration expenditures, mak- ing cash payments of $800,000, and completing an NI 43-101 compliant preliminary economic analysis over a ten- year period. Axe is a 50-km 2 land pack- age in south-central British Columbia in the gold-copper porphyry belt that hosts Newgold's New Afton mine, Teck's High- land Valley mine, and Copper Mountain's namesake mine. Evrim and Antofagasta have completed an extensive data review and approved a $1 million drilling and ex- ploration program for the spring of 2018. Evrim CEO Paddy Nicol said, "This agreement represents our second such transaction with Antofagasta in British Columbia and our fourth transaction over- all in 2017. Evrim now has five active joint ventures and one regional explora- tion alliance." Upon completing the terms of the agreement, Evrim and Antofagasta will participate in a joint venture on the prop- erty on a respective 30:70 basis. If ei- ther party's interest is diluted to 10% or less, it will convert to a 2% net smelter return (NSR). If Antofagasta terminates the agreement prior to earning its 70% interest, it will receive a 0.50% NSR for exploration expenditures exceeding $10 million, an additional 0.25% NSR for expenditures exceeding $20 million, and another 0.25% NSR for expenditures exceeding $30 million, for a maximum of a 1% NSR. Evrim will be the operator for the first $10 million in exploration expenditures. The Axe property contains four known por- phyry targets (West, Adit, Mid, and South) within a 5-km by 3.5-km hydrothermal footprint. Following a review and rein- terpretation of historic exploration data, Evrim considers that the central cores of the West and South zones have not been drilled. Drilling by previous operators ad- jacent to these targets returned intersec- tions such as 124.5 m grading 0.35% copper and 0.22 g/mt gold, including 10.5 m grading 1.55% copper and 0.94 g/mt gold, from one hole at the West zone. Recent work has defined an unex- plored copper, gold, molybdenum, bis- muth, and tungsten in soil anomaly im- mediately east of the Adit and Mid zones over a 1,000-m by 500-m area and is as- sociated with a quartz-sericite-pyrite al- tered gossan and coincident chargeability and conductivity high. This zone only has The first phase of the new Macassa shaft will be completed in 2022 at a cost of $240 million.