Osisko Mining eyes profitable Quebec gold mine
Osisko Mining Inc. [OSK-TSX] has released a feasibility study for its 100%-owned Windfall gold project in Eeyou Istchee James Bay, Quebec.
The study envisages a nine-year mine life with average production of 306,000 ounces of gold and a average all-in-sustaining cost of US$758 an ounce. The reported net present value at US$1,500 an ounce is $965 million and includes 3.16 million ounces of reserves. Excluded from the study is 3.34 million ounces of inferred resources (12 million tonnes at 8.4 g/t.)
The feasibility study reflects drill results as of June, 2022 and includes a dual ramp-access to the mine, central processing mill on site, and figures from the September, 2022, mineral resource estimate. It shows a measured and indicated resource of 4 million ounces at 11.4 g/t and 2.1 million ounces at 6.0 g/t. Probable minerals reserves are estimate at 3.15 million ounces at an average grade of 8.06 g/t.
Total capital costs are estimated at $1.4 billion including life of mine sustaining capital for the planned underground operation of $652 million., and $788.6 million in pre-production costs.
“We are very pleased to deliver the Windfall feasibility study, outlining the supporting economics indicating Windfall can become a significant and highly profitable new gold mine in Quebec,’’ said Osisko CEO John Burzynski.
Osisko has begun detailed engineering work and is progressing towards delivering the Environmental Impact Assessment study in the first quarter of 2023, while initiating the mine permitting process, with permits planned to be received by the first quarter of 2024.
Osisko Mining shares were largely unchanged on the news. The shares eased 0.28% or $0.01 to $3.53 on volume of 366,560 and currently trade in a 52-week range of $5.02 and $2.36.
The mineral resources used in the mine plan are contained in three different zones over a strike length of 2,300 metres and span from surface to a depth of approximately 1,100 metres. The planned underground mine will have a targeted production rate of 3,400 tonnes per day, material that will be processed at the Windfall site.
The process plant building also includes mine and mill offices, a dry, warehouses and first aid office.
Mineralized material will be extracted using a fleet of 14 and 18-tonne load-haul dumps and 54 tonne haul trucks using a ramp to surface.
A 2.1% net smelter royalty on all metals produced from the Windfall project has been applied to the feasibility study, based on existing royalty agreements, and reflecting the mine plan.
Since 2016, Osisko said it has invested over $256 million in the purchase of goods and services from First Nations owned companies or joint ventures.