GLR funds Goldfields

A final feasibility study on the Goldfields gold project near Uranium City, Sask., indicates an open-pit mine and mill would be economic.

The study, prepared for owners GLR Resources (GRS-T, GLRAF-O), considered a mine milling 1.8 million tonnes to produce 90,000 oz. gold annually. It would have a 7-year mine life out of reserves of 11 million tonnes grading 1.69 grams gold per tonne, all in the Box deposit. The pit at Box has a stripping ratio around 3.2.

The project would have a 5,000-tonne-per-day mill.

A mine would have a capital cost of US$46.3 million, and the study pegged cash operating costs at US$280 per oz. and total cash costs at US$374 per oz.

That figure includes mining and processing costs of US$10.13 per tonne of ore, which breaks out to US$2.12 to mine plus US$5.94 in the mill and US$2.07 in overhead. Waste mining costs are US$1.30 per tonne.

At a discount rate of 8% and a gold price of US$525 per oz., the project has a net present value of US$33.1 million and an internal rate of return of 30.5%.

A second deposit, Athona, was not considered by the feasibility study, but is expected to deliver another three years of reserves.

Indicated resources at Athona are 7 million tonnes grading 1.28 grams gold per tonne, at a cutoff grade of 0.5 gram per tonne. There is an additional inferred resource of 1.4 million tonnes, running 1.1 grams gold per tonne.

Environmental permitting is under way, and the company expects to have approvals by late summer.