Engineering & Mining Journal

DEC 2018

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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Page 84 of 115 E&MJ • DECEMBER 2018 83 MINING IN ONTARIO fits all of our M&A objectives. We were look- ing for an existing 10 million tonne resource that was already economic and with the po- tential to at least double in size. In addition, the transaction structure supports a rate of return (ROR) much greater than 15% with long-term prices, including the cost to ac- quire the asset," he said. Few junior companies can claim to have a background as intriguing as Aurania Resourc- es. While researching the historical archives of the Ecuadorian gold mining industry in the late 1990s, Keith Barron, Aurania's founder and CEO, found documentation that proved the existence of the gold producing mines, Logroño de los Caballeros and Sevilla del Oro, that are now lost somewhere in the Cordillera de Cutucu. Years later, in the Vatican library, he found descriptions from 1627 of how to get to the lost city of Sevilla del Oro. Barron has a history of success in Ecua- dor, having co-founded Aurelian Resources in 2001, which made the Fruta del Norte gold discovery in 2006 that was sold to Kinross Gold in 2008 for C$1.2 billion. He insists that Aurania's Lost Cities proj- ect is not a treasure hunt, but the story of a respected management team with world class discoveries already under their belts: "We are conducting a methodical and logi- cal exploration project and we use modern geological, geochemical and geophysical ex- ploration techniques in a geographical area of high discovery potential," affirmed Barron. Toachi Mining was founded by industry heavyweights Laurie Curtis and Jonathan Goodman, who created the company from the restructuring of Ferrum Americas Min- ing when the opportunity to invest in the La Plata project in Ecuador was identified. Alain Bureau, president and CEO of Toachi Mining, likened La Plata, a polymetallic VMS (volcanogenic massive sulphide) project to Agnico Eagle's flagship LaRonde mine in northwestern Quebec. Praising the Ecuadorian governments' in- troduction of fast-forward permits for Scout drilling, Bureau continued: "A streamlined permitting process is particularly vital for ju- nior companies, who cannot afford to lose momentum." Mine the mines abroad, mine the markets in Canada When Superior Gold purchased the Pluton- ic Gold operation in Western Australia for US$30 million from Northern Star in 2016, its leadership team and investors were de- lighted with the transaction, considering the infrastructure there today would have a re- placement value of approximately US$2.5 billion, according to Superior Gold's CEO, Chris Bradbrook. Having produced more than 5.5 million oz of gold since 1990, the Plutonic Gold mine is the sixth largest his- torical producer of gold in Western Austra- lia, and has provided Superior Gold with an impressive cash flow since being acquired in 2016: "Up until the end of Q2 2018, Plutonic has generated over US$34 million for Superior Gold in terms of cash flow from operations," said Bradbrook. Asked to elaborate on the reasoning be- hind a mining company with assets in Aus- tralia being headquartered in Toronto, Brad- brook responded: "Superior Gold's immediate strategy is simple: mine the mine in Austra- lia, and mine the market in North America." Closer to home, Peloton Minerals is fo- cused on three Carlin-style exploration targets in Elko County, Nevada. The targets are lo- cated on the same trend as the Long Canyon project, acquired by Newmont for US$2.3 billion, and Ted Ellwood, president & CEO of Peloton Minerals, believes the area has the district-scale potential: "We strongly believe there is a gold trend of significance there, and the Nevada Geological Society supported this idea at their symposium in 2015." Kinross Gold has entered into a joint ven- ture agreement with Peloton Minerals to ex- plore its Independence Valley project, and the drilling program is expected to start in 2019.

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