IDM Mining Ltd. [IDM-TSXV; IDMMF-OTCQB] said Tuesday January 15 that the Canadian Environmental Assessment Agency has issued a positive decision statement for the company’s Red Mountain underground gold project near Stewart, northwest British Columbia. As a result, the project can now proceed.
The announcement comes just days after Ascot Resources Ltd. [AOT-TSXV; OTVF-OTCQX] said it is acquiring IDM in a deal that values IDM at $0.086 per share.
Ascot said aim is to consolidate its Premier Gold Project with IDM’s Red Mountain Project, thus creating a leading high-grade gold development and exploration company in northwestern British Columbia’s Golden Triangle region.
Ascot has said its near-term strategic goal is to define a new high-grade resource for underground mining, while continuing to explore nearby targets on its Premier-Dilworth properties, also near Stewart.
IDM Mining is focused on advancing the Red Mountain Project towards production. The 17,125-hectare project is located 15 km northeast of the mining town of Stewart. The project is also close to a paved highway and grid power.
Having recently announced an increased high-grade measured and indicated resource, the company envisions bulk underground mining methods, producing gold-silver doré bars at the site.
As proposed, Red Mountain Underground is expected to produce 1,000 tonnes of ore per day or 365,000 tonnes per year over an operational mine life of six years.
In the press release Tuesday, IDM said Canadian Environment Minister Catherine McKenna has announced that under the Canadian Environmental Assessment Act, the proposed Red Mountain Underground Gold Project is unlikely to cause significant adverse environmental effects and the project may proceed.
As part of the Environmental Assessment Decision Statement, McKenna has established more than 120 conditions that IDM must fulfill throughout the life of the project.
For example, the proponent is required to carry out the designated project in a manner that protects migratory birds and avoids killing or disturbing migratory birds or destroying, disturbing or taking their nests or eggs.
IDM shares were unchanged at $0.06 on Tuesday. The shares trade in a 52-week range of 10.5 cents and $0.04. Ascot shares were off 0.89% or $0.01 at $1.11.
IDM recently secured a provincial Environmental Assessment Certificate for the Red Mountain Project, which also provides a defined set of conditions and commitments that will allow for commercial development and operation of the project.
Red Mountain hosts a NI 43-101 compliant estimated resource of 2.8 million tonnes in the measured and indicated category averaging 7.91 g/t gold and 22.75 g/t silver, for 704,600 ounces of gold and over 2 million ounces of silver. On top of that is an inferred resource of 316,000 tonnes, averaging 6.04 g/t gold and 7.61 g/t silver, for 61,400 ounces gold and 77,200 ounces of silver.
“The combined company will control two geological trends, hosting significant ground in the Golden Triangle, which remains highly prospective for additional gold-silver discoveries,” IDM President and CEO Robert McLeod has said.