Engineering & Mining Journal

MAY 2019

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Page 9 of 83

REGIONAL NEWS - U.S. & CANADA 8 E&MJ • MAY 2019 lion ounces (oz) of gold and 30.5 million oz of silver. Highlighting the continued robust economics of the low-cost, long-life op- eration, the new Brucejack mine plan calls for average production of more than 525,000 oz per year (oz/y) of gold over the first 10 years and more than 440,000 oz/y of gold over a 14-year mine life. Average operating costs are estimat- ed at $166/mt milled over the first 10 years and $168/mt life of mine. All-in sustaining costs are estimated at $535/ oz of gold sold over the first 10 years and $539/oz life of mine. Brucejack is a high-grade under- ground operation using the long-hole stoping mining method and cemented paste backfill. The Valley of the Kings deposit — the higher-grade, primary-tar- geted deposit — has been developed first. The lower-grade West Zone will be devel- oped in the second half of the mine life. The processing rate at Brucejack is planned to increase from 2,700 mt/d to 3,800 mt/d by year-end 2019. The capi- tal cost to increase processing throughput is estimated at $22.5 million over the next three years, including a contingency of $1.9 million. A total 15.8 million mt of ore will be mined over a period of 14 years at an average mill feed grade of 12.6 g/mt gold. The 2019 updates are based on six quarters of mining operations at Bruce- jack since commercial production began in July 2017. The Valley of the Kings proven and probable mineral reserve gold grade has been decreased from 16.1 g/mt to 13.8 g/mt to account for more internal waste than was anticipated in Pretium's 2016 mineral reserve update. All estimated costs have been updated based on actual costs from 2018. Areas of cost increase include labor, environ- mental compliance and snow removal. Mineral processing at Brucejack uses conventional gravity concentration and sulphide flotation, producing gold-silver doré and gold-silver flotation concentrate. The mill will be upgraded to use the same process flowsheet at an increased mill feed rate of 3,800 mt/d. Predicted life-of-mine metallurgical re- coveries average 96.5% for gold and 87.4% for silver. Estimated totals of 6.2 million oz of gold and 26 million oz of silver will be produced over the remaining mine life. "Since achieving production at Bruce- jack, we have processed over 1.5 million mt of ore and produced over 500,000 oz of gold, providing us a solid foundation of operating experience and key metrics to update the life-of-mine plan and outlook for the mine," Pretium President and CEO Joseph Ovsenek said. "At $1,300 gold, Brucejack now has an estimated after-tax net present value at a 5% discount rate of $2.59 billion over a 14-year mine life. This is a significant increase from the 2017 es- timated net present value at a 5% discount rate of $2.10 billion. With Brucejack as our foundation and with our considerable growth profile, Pretium is well-positioned as a profitable gold producer." PFS Supports Development of Fission's PLS Property Fission Uranium has reported the results of a prefeasibility study (PFS), including an initial mineral reserve estimate, for its Patterson Lake South (PLS) property in the Athabasca Basin region of northern Saskatchewan. With operating expenses estimated at just $6.77/lb U 3 O 8 and a pre-tax IRR of 29%, the study further en- hances the potential for highly-economic production at PLS. The PFS estimates production averag- ing almost 15 million lb/y of U 3 O 8 over the first five years from mineral reserves of 90.5 million lb of U 3 O 8 . The processing recovery rate is estimated at 96.7%. Initial capital expenditures to devel- op the project are estimated at C$1.49 billion, and sustaining capital, including reclamation and closure, is estimated at C$214 million. Pre-tax payback is esti- mated at two years. Construction would require about four years, followed by an 8.2-year mine life. The PLS PFS is based on initial open- pit mining, followed by underground min- ing. Total plant feed of 2.89 million mt would be processed at an average grade of 1.42% U 3 O 8 . Life-of-mine production is estimated at 87.5 million lb of U 3 O 8 , including an average of 14.35 million lb/y for the first five years. Fission is also progressing a prelimi- nary economic assessment for an under- ground-only scenario that indicates po- tential for improved economics. Freeport Advances Lone Star Project in Arizona Freeport-McMoRan operates seven open- pit copper mines in North America: Morenci, Bagdad, Safford, Sierrita and Miami in Arizona, and Chino and Tyrone in New Mexico. The company has signifi- cant undeveloped reserves and resources in North America and a portfolio of poten- tial long-term development projects. Through exploration drilling, the com- pany has identified a significant resource at its Lone Star project located near the Safford operation in eastern Arizona. An initial project to develop the Lone Star leachable ores commenced in first-quar- ter 2018, with first production expected by the end of 2020. Initial production from the Lone Star leachable ores is ex- pected to average approximately 200 mil- lion pounds per year (lb/y) of copper, with the potential for future expansion options. Total capital costs for the initial pro- ject, including mine equipment and preproduction stripping, are expected to approximate $850 million and will benefit from the utilization of existing infrastructure at the adjacent Safford operation. At the end of the first quarter, the company reported an investment of approximately $385 million for this proj- ect. The project also advances exposure to a significant sulfide resource. Freeport said it expects to incorporate recent pos- itive drilling and ongoing results in its future development plans. Newrange Receives BLM Permit for Merritt Decline The U.S. Bureau of Land Management (BLM) has accepted Newrange Gold Corp.'s proposed assumption of permits and bonding for the Merritt decline and related activities on the Pamlico proj- ect, including collecting the permitted 1,000-ton-bulk sample. The Merritt decline is 3 meters (m) x 4 m x 200 m in dimension and was de- veloped by the prior owners in 2013 at a cost of $2 million to $3 million. At that time, the decline was specifically per- mitted with the BLM for test mining and collecting the bulk sample. Assumption of these permits ensures Newrange has continued access to the Merritt decline. "Transferring the BLM permits into the company's name is an important step in advancing our exploration of the Pamlico Project," CEO Robert Archer said. "This will allow us to put together a comprehen- sive program for larger scale metallurgi- cal and geotechnical tests that will have a significant impact on future resource and reserve estimates."

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