Agnico advances next Nunavut gold mines

Agnico Eagle Mines Ltd. Oct. 25 said it remains on track to have two new gold mines at Amaruq and Meliadine projects in Nunavut by 2019.

"Our major projects in Nunavut continue to advance on time and on budget and we are excited by the significant growth in gold production and the related cash flows that these projects are forecast to provide," said Agnico Eagle CEO Sean Boyd.

Amaruq is being developed as a satellite to Meadowbank, a gold mine that lies about 50 kilometers (31 miles) to the south. Amaruq ore will be trucked to Meadowbank, where it will be processed through the mill.

The company currently expects Amaruq to produce 2 million ounces of gold between 2019 and 2024.

At the end of 2016, Amaruq hosted 16.9 million metric tons of open pit indicated mineral resource averaging 3.88 grams per metric ton (2.1 million oz) gold; 4.9 million metric tons of open pit inferred mineral resource averaging 4.81 g/t (763,000 oz) gold; and 6.8 million metric tons of underground inferred mineral resource averaging 6.22 g/t (1.4 million oz) gold.

Agnico completed 89,217 of drilling in 453 holes at Amaruq in 2017 through the end of September.

This drilling targeted extensions of the deposits at Whale Tail and V Zone; tested the continuity of the new Tugak structure; and investigated the source of the gold-bearing boulders discovered north of Mammoth Lake.

Hole AMQ17-1504, drilled at V Zone, encountered two distinct mineralized structures: 4 meters of 5.3 g/t gold at 313 meters and 6.1 meters of 5.6 g/t gold at 389 meters.

The company said two other nearby holes intersected what appears to be the same two distinct mineralized layers at greater depths - AMQ17-1448, collared 140 meters east of hole -150, cut 4.8 meters of 5.5 g/t gold from 447 meters and 6.5 meters of 5.5 g/t gold from 492 meters depth; and AMQ17-1510, collared 160 meters southeast of hole -1504, cut 4.2 meters of 12.1 g/t gold from 402 meters depth and 5.3 meter of 6.4 g/t gold from 508 meters.

Agnico said the deep V Zone results are expected to expand the underground mineral resource estimate for Amaruq.

At Whale Tail, direction drilling is targeting deep gold mineralization below the proposed pit.

AMQ17-1433E, drilled to roughly 730 meters, cut 16.1 meters of 7.3 g/t gold from 627 meters.

Almost 300 meters below this intercept, AMQ17-1436B cut 5.3 meters of 5 g/t gold at 915 meters, the deepest gold drilled so far.

To date, the Whale Tail deposit has been defined over at least 2,300 meters along strike and from surface to 915 meters.

Agnico drilled 28 holes at the Tugak showing, a 2017 discovery about 4,500 meters west of Whale Tail. One Tugak hole, AMQ17-1484, cut 1.2 meters of 13.6 g/t gold from a depth of 141 meters.

The 2017 drill program at Amaruq will continue until mid-December. A follow-up drill program will be carried out on the showing in 2018.

Agnico is on pace to begin production at Meliadine, a gold project about 25 kilometers (15 miles) from the town of Rankin Inlet, Nunavut in 2019. The2017 program there includes some 5,600 meters of underground development; about 26,500 meters of drilling; and new camp and other surface facilities.

In addition to the development work, the company had one drill testing the potential of targets along an 80 kilometer- (50 miles) long greenstone belt blanketed by the Meliadine property.

-SHANE LASLEY