The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
Forecast to average 144,000 oz gold, 2.2M oz silver annually North of 60 Mining News – August 19, 2022
Benchmark Metals Inc. Aug. 16 published results from a preliminary economic assessment that outlines an economically robust mine at its Lawyers project in Northern British Columbia that would produce 1.7 million ounces of gold and 26.7 million oz of silver over an initial 12 years of mining.
According to a calculation completed in June, the AGB, Cliff Creek, and Dukes Ridge deposits at Lawyers host 67.38 million metric tons of measured and indicated resources averaging 1.26 grams per metric ton (2.74 million oz) gold and 24.39 g/t (52.9 million oz) silver; plus 4.87 million metric tons of inferred resource averaging 2.39 g/t (378,000 oz) gold and 39.41 g/t (6.2 million oz) silver.
Based on this resource, the PEA envisions ore from open-pit mines at these three deposits feeding a 10,600-metric-ton-per-day processing plant centrally located between AGB and Cliff Creek-Dukes Ridge that would produce a gold-silver doré bullion on site.
"The PEA confirmed the current project development timelines, with industry standard open-pit mining methods, processing flowsheet, design criteria, and compact footprint," said Benchmark Metals Vice President of Engineering Ian Harris.
With the mineralization being fed into the mill averaging 1.47 g/t gold-equivalent, which accounts for the value of the silver, the operation envisioned in the PEA would produce an average of roughly 144,000 oz of gold per year at an all-in sustaining cost of US$824/oz, net the value of the 2.2 million oz of silver that would be produced as an annual by-product.
The initial capital to develop this operation is estimated to be C$493 million (US$384 million), which includes C$72.8 million (US$56.7 million) in contingency, and the life-of-mine capital requirements are estimated at C$632 million (US$492 million).
At an average gold price of US$1,735/oz and silver price of US$21.75/oz, this operation is estimated to generate an after-tax net present value (5% discount) of C$577 million (US$449 million) and an internal rate of return of 23.5%.
The capital pay-back period is estimated at 2.7 years.
"The PEA clearly demonstrates the low cost and robust return of the Lawyer's gold-silver project even when stress tested with considerable contingency in the base case," said Benchmark Metals CEO John Williamson.
With results from the PEA now released, Benchmark is forging ahead with a feasibility study that is slated for completion before the end of next year.
Considerable work has either already been completed or is on track to be completed for the collection of data for this study.
The company is also carrying out drilling to expand the resources around the deposits considered in the PEA.
"Multiple target high-grade resource areas have been identified near but outside the pit limits," said Harris.
The engineering VP says underground mining and refining the production schedule also offer a significant opportunity to bolster the economics of the project.
"These evaluations that represent a considerable upside opportunity will be incorporated into detailed mine planning of the feasibility study," he added.
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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