By Peter Kennedy
Sabina Gold & Silver Corp. [SBB-TSX; SGSVF-OTC; RXC-FSE] said December 6 that it has reached a key milestone as it moves to advance its Back River Gold Project in Nunavut, northern Canada towards production.
The company said the Minister of Indigenous and Northern Affairs Canada informed the company that the Back River Project can move forward to the regulatory and licensing phase, which would include the completion of all necessary permits to commence mine construction.
The move comes about six months after the Nunavut Impact Review Board (NIRB) completed its review of the environmental assessment of the project and recommended to the Minister that the project should be given approval to obtain the required permits and licenses for mine construction and operation.
In a letter dated December 5, 2017, the Minister on behalf of the five responsible federal Ministers, accepted NIRB’s recommendation. The NIRB will now work towards issuing a project certificate for Back River, which will attach the terms and conditions for mine development, construction, operation and eventual closure.
“This letter is a significant milestone event for the Back River Project and for Sabina as it is the most important decision in the permitting process,’’ said Sabina President and CEO Bruce McLeod.
“After a multi-year environmental assessment, we are extremely pleased that Back River now has the green light to move ahead to the final phase,’’ he said.
Sabina holds a 100% interest in the Back River Gold Project, which has the potential to produce 200,000 ounces of gold annually for 11 years, according to the results of a feasibility study that was released in September, 2015.
At a US $1,150/oz gold price and $0.80 exchange rate, the study delivers a potential after tax internal rate of return of 24.2% with an initial capital expenditure of $415 million.
Sabina has said its goal is to become a mid-tier gold producer in politically safe mining jurisdictions. The company’s other properties are located in the Red Lake, Ontario region. They include the Golden Sidewalk property. It hosts the past-producing Bathurst Mine, which saw sporadic production between 1928 and 1937.
On Wednesday December 6, Sabina shares rose 0.95% or $0.02 to $2.12.