The mining newspaper for Alaska and Canada's North
The mining newspaper for Alaska and Canada's North
North of 60 Mining News - September 6, 2024
Thesis Gold CEO Ewan Webster inspects core from 2023 drilling at the Lawyers-Ranch gold-silver project.
Thesis Gold Inc. Sept. 5 published a preliminary economic assessment PEA that outlines plans for an economically robust mining operation at its merged Lawyers-Ranch gold-silver project in Northern British Columbia's Toodoggone Mining District.
Last year, Thesis Gold merged with Benchmark Metals Inc. to form a stronger mineral exploration company aimed at leveraging the synergies and economics of scale of bringing together the neighboring Lawyers and Ranch properties.
Including drill programs that were underway prior to the August finalization of the merger, Thesis completed roughly 50,000 meters of drilling focused on upgrading and expanding resources in preparation for completing a PEA that investigates the economics and engineering parameters of developing an open-pit and underground mining operation that processed ore from both properties.
"Starting in 2023, we set an ambitious goal to focus our exploration and engineering efforts on optimizing our project establishing a low-cost future producer with a quick payback period and a projected mine life exceeding 10 years, while in parallel establishing substantial opportunities for future expansion. We are delivering on that promise," said Thesis Gold President and CEO Ewan Webster.
According to a calculation that incorporates the results from the 2023 drilling, the merged properties host 82 million metric tons of measured and indicated resources averaging 1.11 grams per metric ton (2.92 million ounces) gold and 31.9 g/t (84 million oz silver), or 4 million oz gold-equivalent.
Based on this resource, the PEA outlined a mining operation at Lawyers-Ranch that would produce 2.32 million oz of gold and 56.4 million oz of silver, or 4 million oz gold-equivalent, over 14 years.
At an average gold price of $1,930 per oz and silver price of $24/oz, the operation would generate an after-tax net present value (NPV) of C$1.28 billion ($950 million) and an after-tax internal rate of return (IRR) of 35.2%. This operation would pay back the estimated C$598.5 million ($442.9 million) initial capital expenditures in two years.
At $2,500/oz gold and $30/0z silver, the after-tax NPV jumps to C$2.25 billion ($1.67 billion), the IRR comes in at 52.8%, and the payback period drops to 1.3 years.
"With today's gold price near US$2,500 per ounce, the substantial economic potential of the Lawyers-Ranch Project is clear," said Webster.
The PEA envisions a 12,600-metric-ton-per-day operation located on Lawyers that would process ore from four pits at the property and several small pits at the Ranch property, with a mining sequence intended to maximize grade in the early years, smooth stripping requirements, and provide enough ore to keep the processing facility fed at full production capacity.
At the same time, underground mining at the Duke's Ridge and Cliff Creek deposits on the Lawyers property would provide ore for the mill beginning in year two.
"The inclusion of the Lawyers underground brings high-grade, easily accessible ounces into the early stages of the mine life, significantly enhancing the project's economics compared to the 2022 PEA," said Thesis Gold Chairman Bill Lytle.
The 2024 PEA identified several opportunities to further enhance the Lawyers-Ranch mining operation:
• Pre-concentration of Ranch ore using sorting technology to increase the average grade and reduce trucking costs.
• Upgrading and expanding the resources, especially on the Lawyers property.
• Improve pit strip ratios and slopes with better-than-expected geotechnical conditions.
• Collaborate with First Nations to develop the project closure and reclamation plan to meet long-term Indigenous end land use objectives.
With the PEA now complete, Thesis is advancing to a pre-feasibility study (PFS) for the Lawyers-Ranch project. This includes a 10,000-meter drill program currently underway that is focused on upgrading additional resources to the measured and indicated category for potential conversion into reserves when the PFS is complete.
At the same time, the company is carrying out:
• Additional geotechnical and hydrogeological investigations for mine infrastructure.
• Project-scale hydrogeology program to support the development of a site-wide water balance.
• Mineral processing and recovery testing to optimize the gold-silver recovery flowsheet.
• Continued ore-sorting testing for inclusion in the PFS.
• Near-completion of a two-year environmental baseline study program.
Thesis also continues to explore the wider potential of its gold and silver-enriched district-scale land-package in Northern B.C.
"As we advance toward key project development milestones, we will continue to explore new targets within our expansive, highly prospective land package," said Webster. "This approach will further enhance a project that is not only straightforward and low-risk but also benefits from high-grade, easily accessible open-pit and underground ounces, combined with proximity to existing infrastructure."
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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