Engineering & Mining Journal

NOV 2018

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REGIONAL NEWS - U.S. & CANADA 10 E&MJ • NOVEMBER 2018 www.e-mj.com on site. Gryphon mine ore is assumed to be processed at Denison's 22.5% owned McClean Lake mill. Taken together, the two mines would produce an estimated 109.4 million lb of U 3 O 8 over a 14-year mine life, with initial pre-production capital expenditures esti- mated at C$322.5 million. The Wheeler River project is a joint venture between Denison (63.3% own- er and operator), Cameco (26.7%), and JCU (Canada) Exploration Co. (10%). Denison is increasing its ownership in the project to up to 90% under two recently announced agreements with Cameco. The Wheeler River PFS was prepared on a 100% project basis, as each of the partners in the joint venture are subject to different tax and other obligations. "The selection of ISR mining for the high-grade Phoenix deposit is a defining moment for our company and a potential- ly transformational development for the future of uranium mining in the Athabas- ca Basin, bringing the world's lowest-cost uranium mining method to the jurisdic- tion hosting the world's highest-grade uranium deposits," Denison President and CEO David Cates said. "Based on an estimated production cost of US$3.33/lb U 3 O 8 and relatively modest initial capital costs, the Phoenix operation is expected to have superior leverage to an anticipated recovery of the spot price of uranium owing to the fact that the operation may not require a book of long-term contracts to support a devel- opment decision," he added. "The Gry- phon deposit is a perfect complement to Phoenix, as it is expected to supply addi- tional low-cost pounds, financed through cash flow from Phoenix, at a time when the uranium market is expected to be in a significant supply deficit." The Wheeler River project is the largest undeveloped uranium project in the east- ern portion of the Athabasca Basin. The project is situated in close proximity to im- portant regional infrastructure, including the Provincial electrical transmission grid and an all-season Provincial highway. The suitability of ISR mining for the Phoenix deposit has been confirmed by significant field and laboratory work, in- cluding drill hole injection, permeabil- ity, metallurgical leach, agitation, and column tests. Results demonstrate high rates of recovery in both extraction (+90%) and processing (98.5%) follow- ing a simplified flowsheet that precip- itates uranium directly from the urani- um-bearing solution, without the added costs associated with ion exchange or solvent extraction circuits. The Gryphon deposit is located ap- proximately 3 km northwest of the Phoe- nix deposit and occurs 520 m to 850 m below surface, dominantly within compe- tent basement rocks. The deposit has an overall strike length of 610 m, dip length of 390 m, and variable thickness from 2 to 70 m, depending on the number of mineralized lenses present. Coeur Acquiring Projects, Land Adjacent to Rochester Coeur Mining has entered into a defini- tive agreement with Alio Gold to acquire a property package adjacent to Coeur's Rochester mine in west-central Nevada. The acquisition includes Alio's Lincoln Hill and Wilco projects, its Gold Ridge property, and other nearby claims. Coeur will pay for the acquisition through issu- ance of $19 million of its common stock. Coeur anticipates that the acquired projects will have significant operational synergies with the open-pit, heap-leach Rochester operation. The principal asset is the Lincoln Hill project, which is a high-grade, open-pit, gold-silver devel- opment project located approximately four miles west of Rochester. Lincoln Hill has historical measured and indicat- ed resources totaling 364,000 ounces (oz) of gold and 10.2 million oz of sil- ver in 29.3 million metric tons (mt) of mineralized material, plus 255,000 oz of gold and 8.2 million oz of silver in inferred resources. The Wilco project is a gold-silver ex- ploration project that covers approximate- ly 8,900 acres, with historical measured and indicated resources of 1.3 million oz of gold and 12 million oz of silver in 114.1 million mt of mineralized material, plus 541,000 oz of gold and 6.1 million oz of silver in inferred resources. In total, subject to closing, the proj- ects will more than double Coeur's land position at Rochester from roughly 16,300 acres to more than 40,300 acres. The acquisition is in line with Coeur's strategy of growing its production and cash flow with the addition of low-risk, high-quality, high-return assets that can be leveraged to its existing infrastructure, workforce and expertise at the Rochester mine. With the completion of a planned crusher expansion and Stage VI leach pad expected in 2021, along with additional permitting, Lincoln Hill is expected to be- come a source of higher-grade, low-cost production capable of bolstering future cash flow and further extending Roches- ter mine life. The average gold resource grade at Lincoln Hill is more than four times high- er than Rochester's current grade. "The acquisition of this property package from Alio represents a unique opportunity to bolster our Rochester op- eration in a manner that satisfies all our acquisition criteria," Coeur President and CEO Mitchell J. Krebs said. "The Lincoln Hill project provides higher-grade ounces located near Rochester's infrastructure, Coeur's Rochester mine is located in Pershing County, Nevada, adjacent to a property package owned by Alio Gold that includes the Lincoln Hill project.

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