GLR dusts off cobwebs

With the price of gold on the rise, GLR Resources (GRS-T) has decided to forge ahead with the development of the Box and Athona deposits, which form part of its Goldfields project on the north shore of Lake Athabasca in northern Saskatchewan.

An updated in-house engineering study indicates a financially robust open-pit project at a gold price of US$300 per oz. and an exchange rate of C$1.50 per US$1.

The latest study is based on an all-gravity gold recovery system achieving 87% recovery. Initial capital costs are pegged at $13 million, including $3 million for mining, $6 million for treatment and $4 million for services and administration. The pretax net present value, at a 10% discount, is $19.5 million.

Plans call for a 1,000-tonne-per-day mining operation (later increasing to 2,000 tonnes) to produce an average of 40,000 oz. of gold per year over 10 years. Operating cash costs are expected to be less than US$200 per oz.

Originally, a 1996 full feasibility study envisaged a 6,000-tonne-per day operation, but the project stalled in response to market conditions at the time.

In its latest incarnation, the contractor-run operation will initially target a measured and indicated resource totalling 500,000 contained ounces at a grade of 2.1 grams gold per tonne contained in a starter pit at the Box deposit only.

The 1996 feasibility study pegged the Box resource at 13.3 million tonnes running 1.7 grams gold per tonne. Athona’s resource stood at 4.8 million tonnes of 1.8 grams gold. Both zones remain open at depth. Much of the gold occurs as free gold with some relatively large particles.

Final submissions for environmental permits are being prepared, and approval is expected by late summer.