Atlantic Gold Corp. [AGB-TSXV; SPVEF-OTC] has filed a technical report to support a recently announced new life of mine plan for the company’s Moose River Consolidated (MRC) Gold Mine in Nova Scotia.
Moose River commenced operations with the first gold pour and initial production from the Touquoy deposit in October 2017. According to a July, 2015 feasibility study, the Phase 1 Life of Mine plan was forecast to produce an average of 87,000 ounces of gold per year over a minimum 8.5-year mine life at an all-in sustaining cost of C$690 an ounce.
However the Phase 1 Life of Mine plan incorporated only two of the four deposits (Touquoy and Beaver Dam) in to its mining plan. The central processing facility is now built and is in production at Touquoy.
The Phase 2 expansion study demonstrates the potential to add significantly to the Phase 1 Life-of-Mine production by incorporating the additional satellite deposits at Fifteen Mile Stream and Cochrane Hill. Both are located within trucking distance of the central processing facility at Touquoy and readily accessible by highway.
Conventional open pit mining methods have been proposed with a maiden proven and probable mineral reserve of 432,000 ounces for Fifteen Mile Stream and 393,000 ounces for Cochrane Hill.
A Phase 2 Life-of-Mine Expansion Pre-Feasibility Study sees production ramping up to 200,000 ounces of gold annually, while maintaining an industry lowest quartile all-in sustaining cash cost of CAD$692 an ounce or US$555 an ounce.
The study demonstrates the economic viability of mining the 100%-owned Fifteen Mile Stream and Cochrane Hill deposits as satellite operations to the Touquoy central processing facility with an in initial incremental after-tax net present value of $188 million.
Given the robust results of the study, the company is proposing the staged development of both Fifteen Mile Stream and Cochrane Hill, including the submission of the environmental impact statement for both projects in the second half of 2018.
“We are very excited to issue the results of this study representing the initial estimation of the new life of mine plan at MRC for the Phase 2 expansion,” said Atantic Gold Chairman and CEO Steven Dean. “This represents a placeholder which we expect will be added to as a result of the expected mineralization extensions from the drill programs at Fifteen Mile Stream and Cochrane Hill,” he said.
“Stay tuned for further updates during the course of 2018 from the Phase three drill program and planned updated resource estimates.”
Drilling is ongoing at Fifteen Mile Stream and Cochrane Hill with the aim of supporting upgrades of some or all of the inferred mineral resources to higher confidence categories, and potentially expanding the known mineralization limits.
On Friday, Atlantic Gold shares eased 0.53% or $0.01 to $1.86. The 52-week range is $1.88 and 97 cents.