At its 3-million-oz. Meadowbank gold project in Nunavut,
Preliminary economic studies show that Meadowbank, with its five closely spaced, near-surface gold deposits, now contains enough ounces to sustain such an operation for 8.3 years, falling roughly 400,000 oz. short of the 10-year plan. With cash operating costs pegged at US$168 per oz., total production costs at US$235 per oz and capital costs at US$123.5 million, the Meadowbank project offers a payback period of 4.9 years, based on a gold price of US$300 per oz.
Cumberland needs a 10-year mine plan to ensure a sufficent payback, and, according to Senior Vice-President Kerry Curtis, “it’s doable with the size of the program we have this year.”
The mining plan incorporates three open pits: a single large pit combining the Third Portage and North Portage deposits, and two satellite pits on the Goose Island and Vault deposits, which lie 400 metres and 5 km away, respectively. Deeper resources at Goose Island and Vault will be mined by underground methods.
The mine model is based on measured, indicated and inferred resources totalling 14.4 million tonnes at a minable grade of 4.86 grams gold per tonne, equivalent to more than 2.2 million contained ounces. About 85% of the modelled resource is minable by open-pit methods at a stripping ratio of 7.8-to-1.
The overall resource contains a measured and indicated reserve of 1.4 million oz. within 7.8 million tonnes grading 5.79 grams, whereas a further 10.9 million tonnes grading 4.44 grams, containing 1.6 million oz., are categorized as inferred.
The scoping study incorporates seasonal road and barge access, fly-in/fly-out personnel rotation, and year-round production using gravity and conventional flotation milling methods for a projected recovery of 90.6%. The Meadowbank project is 70 km north of Baker Lake.
Using two diamond drill rigs, Cumberland has begun to test the expansion potential of the Vault, North Portage and Third Portage deposits. To date, 14 holes totalling 2,185 metres have been completed, with some 67 holes planned. Results from some of the first holes into the northern portion of the Third Portage deposit have yielded several high-grade intersections, including: 3.4 metres of 5 grams at 27 metres below surface, followed by 5.1 metres of 14.1 grams (including a 146-gram intercept across 0.42 metre) at 36 metres depth in hole 385; and 3.3 metres of 22.1 grams at 47 metres from surface in hole 387.
Cumberland also intends to carry out overburden drilling over a 5-km unexplored area that stretches between the original four Meadowbank deposits and the Vault deposit. To date, the area has received no diamond drilling. “Obviously when you have a couple of million ounces down to the south and closer to one million ounces up to the north, the hunting should be pretty good in that space,” says Curtis.
Cumberland subjected the area to airborne geophysics at the close of last season, but prospecting has been limited by the overburden cover, which ranges from one to 10 metres thick.
About 400 holes will sample the overburden and underlying bedrock. So far, more than 135 holes have been completed, and 930 samples have been sent away for geochemical analysis. The results will be overlapped with the geophysical data to generate targets.
Metallurgical studies continue to examine ways of improving gold recoveries. A total of 850 kg of material from all five deposits has been shipped to Lakefield Research for testwork. In addition, engineering studies, including geotechnical and environmental programs, are being initiated in preparation for feasibility.
Cumberland is well-financed with $5.8 million in working capital and has 30 million shares outstanding, or 33.8 million on a fully diluted basis.
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