Kemess Underground receives first approvals

 

Last updated 1/18/2018 at 7:32pm



AuRico Metals Inc. March 22 reported that federal and provincial authorities have issued a first round of permit approvals for development of a mine at its Kemess Underground, a large gold-copper-silver project in northern British Columbia. This includes a positive decision statement by the Canadian Environmental Assessment Agency and an environmental assessment certificate granted by the British Columbia Environmental Assessment Office.

Kemess Underground is located about six kilometers (3.7 miles) north of the past producing Kemess South open-pit mine, which produced about 3 million ounces of gold and 750 million pounds of copper from 1998 until 2011.

AuRico now owns Kemess South and the roughly C$1 billion of infrastructure that goes with it. This includes a camp, powerline, all-weather air-strip and access road, as well as other surface facilities including an administrative building, workshop and warehouse.

AuRico published a feasibility study for the Kemess Underground project in 2016 that contemplates the development of a low-cost panel caving operation with an initial 12-year mine life.

Ore would be transported by conveyor to the existing processing facilities, with concentrate transported to a wholly-owned concentrate load-out facility in Mackenzie, B.C. The mine outlined in the study is expected to produce 1.4 million oz of gold, 573 million lbs of copper and 4.5 million oz of silver.

Total up-front capital expenditure for developing Kemess Underground is estimated at US$452 million with a payback period estimated at 3.3 years.

"The Kemess Underground project presents an attractive development opportunity given its strong economics - supported by existing infrastructure, large scale, good jurisdiction, and advanced stage," said AuRico President and CEO Chris Richter. "Today's environmental approval represents a significant milestone for the project, and we are excited about the opportunity to continue to advance the project to the benefit of all stakeholders." Kemess underground will require a number of additional licenses and permits which the company expects to receive early in 2018.

AuRico also owns the Kemess East deposit, 1,000 meters east of Kemess Underground.

In January, the company released an updated resource estimate for Kemess East outlining 113.1 million metric tons of indicated resources averaging 0.38 percent copper and 0.46 grams per metric ton gold; and 63.8 million metric tons of inferred resource grading 0.34 percent copper and 0.31 g/t gold.

-SHANE LASLEY

 

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