Hope Bay on-track for late 2016 production
Last updated 11/15/2015 at Noon
TMAC Resources Inc. Nov. 5 provided an update on progress in developing a mine at the Hope Bay gold project in Nunavut.
The building and offsite testing of the processing plant is 22 percent complete and remains on schedule for shipping early in the third quarter of 2016.
Meanwhile, underground mobile mine equipment capable of mining at a rate of 1,000 metric tons per day; 15 million liters of diesel; the mill building; and first-year mining parts and supplies were delivered to Hope Bay in anticipation of beginning production by the end of 2016.
"The third quarter of 2015 was our first quarter as a TSX-listed, fully-financed, gold development company.
During the quarter, we significantly de-risked the Hope Bay Project financially by securing equity and debt financing for gross proceeds of over C$350 million.
In addition, we continued test mining underground at Doris, commenced construction on the foundations for the mill building, shipped the mill building components to site, and continued our work with Gekko Systems of Australia to execute on the procurement, fabrication and testing of the processing plant for shipment and installation during the third and fourth quarters of 2016.
We remain on track and on budget for reaching production at the end of 2016," summarized TMAC CEO Catharine Farrow.
Mining crews began extracting a test stope in Doris in order to validate planned mining methods and increase management's confidence in the assumptions for the mining costs in the pre-feasibility study.
The crews were able to achieve a stope width of less than one meter, decreasing the tonnage in this particular stope from an estimate of 1,600 to 650 metric tons.
By decreasing the dilution, the grade increased from an estimated 13 grams per metric ton to 31 g/t.
The lessons learned from the mining conducted in the test stope are being applied to the 2015 and 2016 mine plans to reduce mining dilution and improve head grades.
The primary objective of TMAC's 2015 exploration and evaluation budget is to support the advancement of Hope Bay through continued geological modeling, diamond drilling and metallurgical test work and resource definition at the Doris and Madrid deposits.
Drilling at Doris is focused on further definition of stopes within the first two years of the Hope Bay mine plan.
A total of 4,382 meters of surface drilling in 38 holes was completed on the Doris North zone in the third quarter.
Drilling at the Madrid deposit trend is focused on the Naartok zone with the objective of further defining the high-grade areas and the addition of gold ounces to the resource base.
A total of 6,163 meters were drilled in 24 holes during third quarter 2015 on the Naartok zone.
Assay results are pending and geological interpretation is in progress.
TMAC also carried out regional exploration work beyond the Doris, Madrid and Boston trends that included airborne magnetic-electromagnetic and induced polarization geophysical surveys over the Hope Bay greenstone belt.
Further afield, the company flew airborne geophysics over its Elu claims, which the company also purchased from Newmont in 2013.
The Elu claims cover 305 square kilometers (118 square miles) of the Elu greenstone belt, which is about the same age as the Hope Bay greenstone belt about 35 kilometers (22 miles) to the southwest.
TMAC says limited historical exploration at Elu suggests that there is potential for significant gold mineralization similar to the deposits found within the Hope Bay greenstone belt.
Through Sept. 30, TMAC had incurred C$120 million of the planned C$165 million of the path to production expenditures for the 2015 financial year, which is in line with TMAC's budget and timing.
The total estimated expenditure and working capital for 2015 and 2016 remains at C$290 million.
At Sept. 30, TMAC had C$84.99 million in cash and cash equivalents.
In addition, the company had C$18.66 million invested in long-term cash deposits or restricted, for a total of C$103.65 million in cash and cash investments.