The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Tower Hill board okays $2.6M program for Alaska gold project North of 60 Mining News – March 13, 2020
The 11.5-million-ounce Livengood gold mine project lies alongside the paved Elliott Highway and Trans-Alaska Pipeline about 70 miles north of Fairbanks, Alaska.
The net present value (5% discount) of a Livengood mine outlined in the 2017 pre-feasibility study is nearly US$800 million at today's gold price.
International Tower Hill Mines Ltd. March 10 announced that its board has approved US$2.6 million for the 2020 work program at its 11.5-million-ounce Livengood gold project in Interior Alaska.
Lying alongside a paved highway about 70 miles north of Fairbanks, Livengood is a near development gold mine project that could produce 6.8 million oz of gold over a 23-year mine life, or roughly 294,100 oz annually, according to a prefeasibility study completed in 2017.
This is based on 392 million metric tons of reserves averaging 0.71 grams per metric ton (9 million oz) gold. Overall, the Money Knob deposit at Livengood hosts 525 million metric tons of measured and indicated resource averaging 0.68 g/t (11.5 million oz) gold.
Since the completion of the PFS, Tower Hill has focused its efforts on studies to optimize the economics of mining this world-class gold project.
This optimization work has primarily focused on metallurgical studies aimed at improving gold recoveries and refining the project flowsheet.
During 2018, the company collected 4,000 kilograms (8,818 pounds) of metallurgical composites from select areas of Money Knob.
Roughly half of the sample material was processed at SGS facilities in British Columbia under the guidance of the engineering firm BBA Inc. during 2019.
Tower Hill said the metallurgical work aimed at optimizing gold recovery and reducing the costs of building and operating a mine at Livengood is now in its final stages.
With gold prices near US$1,700/oz, wrapping up this optimization work is coming at a great time for Tower Hill and the Livengood project.
"The recent gold market strength provides an encouraging environment for our company as we continue work to establish the best foundation to support future development," said International Tower Hill Mines CEO Karl Hanneman. "The 11.5-million-oz gold resource at the Livengood gold project is in a premier jurisdiction and the project is highly leveraged to the gold price. For example, if we assume 6.8-million-oz production over 23 years, every US$100/oz increase in the gold price would increase project revenue NPV@5% (net present value at 5% discount) basis by approximately US$428 million, or approximately US$2.25 per current share."
In addition to the optimization work, Tower Hill will advance ongoing environmental baseline efforts needed to support future permitting, as well as to continue community engagement.
With US$6.8 million in working capital going into 2020, Tower Hill has plenty of cash in its treasury to complete this and future work at Livengood.
Over his more than 16 years of covering mining and mineral exploration, Shane has become renowned for his ability to report on the sector in a way that is technically sound enough to inform industry insiders while being easy to understand by a wider audience.
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