ITH advances Livengood as gold prices rise
Optimized PFS for mining 11.5M-oz Alaska gold deposit coming North of 60 Mining News – May 15, 2020
Last updated 9/26/2020 at 2:26pm
After years of quietly and efficiently optimizing a plan for Livengood, International Tower Hill Mines Ltd. is now moving ahead with new pre-feasibility study for developing a mine at the 11.5-million-ounce gold project about 70 miles north of Fairbanks, Alaska.
A previous PFS completed for Livengood in 2017 outlined plans for a 52,600-metric-ton-per-day mill that would produce 6.8 million ounces of gold over a 23-year mine life, or roughly 294,100 oz annually.
The all-in cost to produce an ounce of gold in the 2017 PFS, however, was estimated to be US$1,247, which caused Tower Hill Mines management to focus its attention on optimization studies aimed at bringing down costs.
The details of the study did not discourage Paulson & Co., which owns 31.8%; Sprott, 16.1%; and Electrum Group, 14.2% from acquiring and holding onto ITH shares.
Marcelo Kim, a partner at Paulson & Co., is currently the chairman of Tower Hill Mines.
Now, with the price of gold topping US$1,700/oz and predicted to move higher as central banks and governments inject unprecedented amounts of cash into a global economy affected by COVID-19, Tower Hill Mines is ready to take a fresh look at establishing a mine at the world-class Livengood gold project.
"Since 2016 we have conserved our cash to maximize optionality for ITH shareholders, and we are well positioned to embark on a new phase for the Livengood project as a result of the favorable macro-economic backdrop for gold." said Kim. "ITH owns the largest independent gold-only resource in North America and we believe that in a rising gold price, the Livengood project becomes one of the most coveted and substantial assets in a geopolitically safe jurisdiction, in a time when most gold companies are struggling to replenish their reserves."
Money invested by Paulson, Electrum and others since 2017 has financed ongoing optimization studies focused largely on metallurgical work aimed at improving gold recoveries and refining the project flowsheet.
"Over the last several years, we have quietly remained laser focused on improving our geological and metallurgical understanding of the Livengood Gold deposit, which reported an 11.5 million ounce gold resource in our 2017 NI 43-101," said International Tower Hill Mines CEO Karl Hanneman. "We intend to use new tools that have emerged in recent years, such as Whittle Enterprise Optimization, to incorporate this new information with our previous solid technical work to design the best possible Livengood Gold project and to update our NI 43-101 to further de-risk the project and demonstrate its value in a higher gold price environment."
While the global economic stimulus related to COVID-19 is expected to push gold prices much higher, which is good for road-accessible multi-million-oz gold mine projects like Livengood, the pandemic itself is disrupting personal lives and normal business practices.
With this in mind, the Tower Hill team is working with technical consultants to develop a definitive timeline and budget for completion of an updated Livengood PFS. It is, however, currently anticipated that the study will be finalized in the second half of 2021.
The outcomes from this engineering and financial study, along with the gold price outlook, will determine whether the Tower Hill Mines is ready to advance the project into permitting.
With a roughly 4.5-year timeline for permitting and 2.5 years for development, a quick decision to advance Livengood could lead to a mine at the 11.5-million-oz gold project by 2030.