Ascot Resources Ltd. (TSX: AOT; OTCQX:
AOTVF) (“
Ascot” or the
“
Company”) is pleased to announce robust results
for an independent Feasibility Study (the “
Study”)
prepared in accordance with a National Instrument 43-101 Technical
Report (“
NI 43-101”) for its 100% owned Premier
and Red Mountain gold projects (the "
Project")
located in the Golden Triangle near Stewart, British Columbia,
Canada. The Study outlines a low capital restart plan to feed
the Premier mill at 2500 tonnes per day (“
tpd”) to
produce approximately 1.1 million ounces (“
Moz”)
of gold and 3.0Moz of silver over eight years. The Study is
based on a proven and probable reserve (noted below) of 6.2 million
tonnes (“
Mt”) from the Project. In addition
to the reserves, the Company has inferred resources of 5.1Mt at
7.25 grams per tonne (“
g/t”) gold at Premier, with
approximately 2.2Mt of this resource material at similar grade,
near the planned development, which may potentially be converted to
reserves during operations.
Feasibility Study
Highlights:
Base case assumptions are using a US$1400/oz
gold price, $17/oz silver price and CAD to US exchange rate of
0.76. All values shown in Canadian dollars unless otherwise noted.
Some figures may not add due to rounding
- Base case Pre-Tax Net Present Value (“NPV”)
NPV5% of $516M, internal rate of return (“IRR”)
IRR of 62%;
- Base case After-tax NPV5% of $341M and IRR 51%, and after-tax
payback period of 1.8 years;
- Assuming a spot gold price of US$1710 per ounce and spot CAD to
US exchange rate of 0.71, the project economics increase to an
After-tax NPV5% of $602M and IRR 78%;
- The base case utilizes Proven and Probable Reserves of 6.2Mt at
5.9g/t gold and 19.7g/t silver; this includes the impact of the
mining dilution and excludes all resources outside of planned
stopes
- Low initial capital expenditure of $147M, including a 9%
contingency, and 22% indirect costs;
- Life of Mine (“LOM”) payable production of
1.1Moz of gold and 3.0Moz of silver with peak production of 180
thousand gold equivalent ounces;
- LOM operating costs (“C1”)* of $145 per tonne
processed or US$642 per payable ounce produced and LOM all in
sustaining costs (“AISC”)* of $174 per tonne
processed or US$769 per payable ounce produced.
*
C1 and AISC are Non-GAAP and IFRS measure see note 1 of Table 1
Ascot’s President and CEO,
Derek White commented, “The completion of the Feasibility Study
marks an important milestone for Ascot in the progression of
restarting the Project. The current strong gold price environment,
robust projected economics and quick payback creates an attractive
opportunity to build our mine. The Study focused on
maximising the project economics, which involved optimising mining
methods and development to reduce operating cost per ounce.
The result of this optimisation was a conversion of 64% of
indicated resources to reserves at Premier. Management believes
that future underground drilling will help to improve conversion of
some of the remaining inferred resources and improve annual
production rates. Management’s next steps will be focused on
advancing this exceptional gold project with all our stakeholders
while continuing to grow our mineral resources and reserves to
enhance value through further drilling and delivering a number of
identified opportunities.”
Potential value enhancement opportunities identified
beyond the scope of the study:
- Reduced mining dilution and development capital by optimizing
shallow angle mining;
- Conversion of approximately 2.2Mt of resources in the Inferred
Category;
- Reduced process capital and operating cost by introducing
process enhancements.
Feasibility Overview
The Premier Gold Project
(“PGP”) is located 25 kilometres
(“km”) north of the town of Stewart, British
Columbia, adjacent to the border with Alaska in the famous gold
mining district known as the Golden Triangle. The PGP can be
accessed by road from Stewart and does not require a remote
campsite for employees. Three of the deposits are based at
PGP and the fourth deposit is located at the Red Mountain Project
(“RMP”), situated approximately 23km to the
southeast of the PGP mill. PGP requires amendments to the
Mines Act and Environmental Management Act permits and is a
brownfield site; it does not require an Environmental
Assessment. RMP has federal ministerial approval and
provincial environmental assessment certificates, but will require
multiple permits and potential amendments, including a Mines Act
permit and an Environmental Management Act permit.
The Study is based on four underground mining
operations feeding a centralized 2500 tpd processing facility,
located at PGP. The four mining operations known as Silver
Coin, Big Missouri, Premier and Red Mountain will be sequenced over
an 8-year period to initially produce 1.1 Moz. of gold and 3.0 Moz.
of silver. PGP benefits from existing road access, historical
mining, milling, the nearby Long Lake Hydro power plant, tailings
and mine waste stockpile infrastructure resulting in a low initial
capital refurbishment cost. Mining will commence from the
Silver Coin and Big Missouri deposits, which will be followed by
the Red Mountain deposit in year 3 and then the Premier deposit. In
the four planned operations, access for production will be through
both new and existing adits (side hill portal access) utilizing a
combination of new ramp development and refurbishment of existing
underground infrastructure. Mining methods will largely
consist of low-cost long hole stoping for most of the ore, with
limited use of inclined undercut long hole, room & pillar and
cut & fill mining methods in specific shallow or flat lying
stopes. Ore will be trucked to the processing facility and
mining waste will be used underground as a combination of rockfill
and cemented rockfill.
The existing processing facility will be
refurbished within a construction period of approximately 40 weeks.
The process plant will utilize conventional crushing,
grinding and gravity circuits followed by a standard
carbon-in-leach (“CIL”) process to produce a gold
doré. The plant refurbishment will consist of a combination
of existing, new and repaired equipment and supporting plant
infrastructure. Prior to ore from RMP being treated, the
plant will add an energy efficient fine grinding mill and an
additional pre-leach thickener to accommodate processing of the
harder ore feed and the finer grind required for recovery
purposes.
PGP has an existing tailings storage facility
and water treatment plant, and is adjacent to the Long Lake Hydro
power plant, which currently supplies Pretium’s Brucejack Mine and
connects to the BC Hydro grid. Currently, the site receives
power via a 25-kiloVolt power line from the town of Stewart.
This arrangement would be modified with a new substation to
be constructed adjacent to the processing plant that would receive
power from the Long Lake power plant approximately 800 metres south
of the processing plant. Power would be distributed to the
site from this substation. The Study has two key enhancements
to the existing infrastructure: the tailings dam would be
successively raised using centreline lifts throughout the mine life
with approximately 1.2 million cubic metres (“m3“)
of non-acid generating rock excavated from a nearby quarry; and the
water treatment plant would be modified to nearly double the
existing capacity to accommodate additional water treatment from
the Big Missouri and Silver Coin operations, and would also include
an ammonia treatment plant, a water clarifier and lime high density
sludge system.
In order to complete this study, Ascot engaged a
team of highly experienced professional consultants led by
Sacre-Davey Engineering Inc. (“SDE”). SDE
was responsible for overall coordination, infrastructure and the
economic evaluation; InnovExplo Inc. and Mine Paste Ltd. for
mining; Sedgman Canada Limited (a member of CIMIC Group) for
metallurgy and processing; Knight Piésold Ltd. for tailings and
water management; SRK Consulting (Canada) Inc. for the water
treatment plant; Paul Hughes Consulting Ltd. for site geotechnical;
McElhanney Ltd. for access roads; Prime Engineering for the
Electrical substation; Palmer Environmental Consulting Group Inc.
for geochemistry, hydrology and water quality modelling; and
Falkirk Environmental Consultants and EcoLogic Consultants for
environmental studies.
Table 1: Life of Mine
Summary
Assumptions |
|
Gold Price (US$) |
1400 |
Exchange Rate (US$/C$) |
0.76 |
Payable Metals |
|
Gold Production (koz) |
1059 |
Silver Production (koz) |
2964 |
Mining & Processing |
|
Mine Life (Years) |
8 |
Total Tonnage Milled (Mt) |
6.2 |
Gold Recovery (%) |
91.4 |
Silver Recovery (%) |
76.5 |
Processing Throughput (tpd) |
2500 |
Diluted Average Gold Grade (g/t) |
5.9 |
Diluted Average Silver Grade (g/t) |
19.7 |
Capial Expenditure Costs |
|
Initial CAPEX (CAD $M) |
146.6 |
Sustaining Capital (CAD $M) |
157.1 |
Closure Costs (CAD $M) |
20.5 |
Operating Costs |
|
UG Mining Cost (CAD$/t Milled) |
97.00 |
Processing Cost (CAD$/t Milled) |
31.05 |
G&A Cost (CAD$/t Milled) |
7.93 |
Site Services (CAD$/t Milled) |
3.36 |
Total Operating Costs (CAD$/t Milled) |
139.34 |
Effective Taxation rate % |
33.6 |
Metrics |
|
Direct Cash Costs1("C1") (US$/oz) |
642 |
All in Sustaining Cash Costs1 ("ASIC") (US$/oz) |
769 |
LOM Pre Tax Free Cash Flow (C$M) |
710 |
Pre-Tax IRR (%) |
62 |
Pre-Tax NPV5 ($CADM) |
516 |
After-Tax IRR (%) |
51 |
After-Tax NPV5 ($CADM) |
341 |
After-Tax Payback Period (years) |
1.8 |
1. C1 includes mining processing, site services, G&A,
refining & transportation cost and royalty cost less by-product
credits. AISC includes C1 cost plus sustaining capital. C1 and AISC
costs are non-GAAP performance measures;
Sensitivities
After-tax economic sensitivities are presented
in Table 2 illustrating the effects of varying precious metals
prices and exchange rates to LOM base-case. Additional
project sensitivities will be presented in the Technical
Report.
Table 2: After-Tax NPV (5%) and IRR
Sensitivities to Gold Prices & Exchanges
rate
Sensitivities |
Lower Case |
Base Case |
Higher Case |
Gold Price (US$/oz) |
1200 |
1400 |
1600 |
CAD to USD exchange rate |
0.80 |
0.76 |
0.71 |
After-Tax Payback Period (years) |
2.5 |
1.8 |
1.4 |
After-Tax NPV (5%) (C$M) |
177 |
341 |
534 |
After-Tax IRR (%) |
31 |
51 |
71 |
Mineral Resource Estimate
The Company’s Mineral Resources at the PGP noted
in Table 3 and for RMP in Table 4 are combined to form the basis of
the mineral reserves in this Study. The QP for the resource
estimation work for RMP was completed by independent* consultant
Dr. Gilles Arseneau, P.Geo (APEGBC) with an effective date of the
Mineral Resource Statement of August 30, 2019. The QP for the
resource estimation work at PGP was completed by independent*
consultant Susan Bird, P.Eng (APEGBC) with an effective date of the
Mineral Resource Statement of December 12, 2019.
* Independent ‘qualified persons’ within the
meaning of NI 43-101
Table 3: PGP Mineral Resource Statement
reported at 3.5g/t AuEq cut-off
|
|
|
|
Grade |
Contained Ounces |
|
Tonnes |
Au |
Ag |
Au |
Ag |
kt |
g/t |
g/t |
koz |
koz |
Total Indicated |
4,141 |
8.01 |
35.1 |
1,066 |
4,669 |
Total Inferred |
5,061 |
7.25 |
28.7 |
1,180 |
4,673 |
Notes for Table 3: |
|
|
1. |
Mineral Resources are estimated at a cut-off grade of 3.5g/t AuEq
based on metal prices of US$1,300/oz Au and US$20/oz Ag. |
2. |
The AuEq values were calculated using US$1,300/oz Au, US$20/oz Ag,
a silver metallurgical recovery of 45.2%, and the following
equation: AuEq(g/t) = Au(g/t) + 45.2% x Ag(g/t) x 20 / 1,300. |
3. |
A mean bulk density of 2.85 t/m3 is used for Premier and of
2.80t/m3 for all other deposit areas. |
4. |
A minimum mining width of 2.5m true thickness is required in order
to be classified as Resource material.Mineral Resources are
inclusive of Mineral Reserves declared below. Mineral
Resources are not Mineral Reserves and do not have demonstrated
economic viability. There is no certainty that all or any
part of the Mineral Resources estimated will be converted into
Mineral Reserves. The estimate of Mineral Resources may be
materially affected by environmental, permitting, legal, title,
taxation, socio-political, marketing, or other relevant
issues. The CIM definitions were followed for the
classification of Indicated and Inferred Mineral Resources.
The quantity and grade of reported Inferred Mineral Resources in
this estimation are uncertain in nature and there has been
insufficient exploration to define these Inferred Mineral Resources
as an Indicated Mineral Resource and it is uncertain if further
exploration will result in upgrading them to an Indicated Mineral
Resource category. |
Table 4: RMP Mineral Resource Statement
reported at 3.0g/t Au cut-off
|
|
Grade |
Contained Ounces |
|
|
|
|
|
|
|
|
|
|
Tonnes |
Au |
Ag |
Au |
Ag |
kt |
g/t |
g/t |
koz |
koz |
Total Measured |
1,920 |
8.81 |
28.3 |
543.8 |
1,747 |
Total Indicated |
1,271 |
5.85 |
10.01 |
238.8 |
409 |
Total Measured and Indicated |
3190 |
7.63 |
21.02 |
782.6 |
2,156 |
Total Inferred |
405 |
5.32 |
7.33 |
69.3 |
95.5 |
Notes for Table 4: |
|
|
1. |
RMP Resources are reported at a 3.0g/t Au cut-off for underground
long hole stoping. |
2. |
Reported Mineral Resources are inclusive of Mineral Reserves
declared below. Mineral Resources are not Mineral Reserves
and do not have demonstrated economic viability. There is no
certainty that all or any part of the Mineral Resources estimated
will be converted into Mineral Reserves. The estimate of
Mineral Resources may be materially affected by environmental,
permitting, legal, title, taxation, socio-political, marketing, or
other relevant issues. The CIM definitions were followed for
the classification of Indicated and Inferred Mineral Resources.
The quantity and grade of reported Inferred Mineral Resources
in this estimation are uncertain in nature and there has been
insufficient exploration to define these Inferred Mineral Resources
as an Indicated Mineral Resource and it is uncertain if further
exploration will result in upgrading them to an Indicated Mineral
Resource category. |
Mining and Mineral Reserves
The mineral resources were determined using
conservative cut-off grade estimates and incorporating mining
thicknesses into wireframing and converted to reserves, by applying
mining economics to the resources, including allowing for recovery
and dilution underground. As part of the mine planning
exercise, the indicated mineral resource was run through the Deswik
Stope Optimizer and evaluated under a number of different mining
methods.
The Study’s mine plan generally utilizes a
combination of three mining methods: longhole (64%), inclined
undercut longhole (14%), and room & pillar (12%), with minor
amounts of cut and fill (2%) and development ore (8%) to extract
the mineral reserves. A particular mining method was chosen
based on an economic assessment of each method for a given geometry
and geotechnical characteristics depending on its location in the
deposit. The stope shapes and mine access development were
individually modelled and evaluated to form the final mineable
reserve. Mining dilution occurs at various rates depending on
the mining method and ground conditions based on rock quality in
geotechnical domains in the block model. Dilution comes in
from a number of sources: planned dilution is material taken within
the bounds of a stope layout while unplanned material comes from
the hanging wall and footwall outside the stope boundary.
Dilution generally ranges from 10 to 40%. In some cases where
two wireframes are very close together, the waste parting between
the wireframes was taken provided that it was economically
justified. The over-arching philosophy was to maximize the
extraction of resource ounces at the lowest cost per ounce.
Initial mining commences at Silver Coin
(1.794Mt) and Big Missouri (0.809Mt), followed by RMP (2.545Mt) and
Premier (1.028Mt). This sequencing allows mobile mining
equipment and some fixed assets (electrical and ventilation) to
most effectively be remobilized and re-used at different deposits
as dictated by mine schedules. The Study assumes a lease to
own cost for the mobile mining equipment, which primarily consists
of the following key pieces of equipment: 2 scissor lifts,3
jumbo drills, 5 haul trucks, 5 load-haul-dump machines, 15
ventilation fans, and several other smaller supporting pieces of
equipment.
The mineral reserve figures are shown below in
tables 5 and 6. The QP for the mineral reserve estimation
work for the Project is the independent* consultant Frank
Palkovits, P.Eng.
* Independent ‘qualified persons’ within the
meaning of NI 43-101
Table 5: PGP Mineral Reserve Statement
|
|
Grade |
Contained Ounces |
|
|
|
|
|
|
|
|
|
|
Tonnes |
Au |
Ag |
Au |
Ag |
kt |
g/t |
g/t |
koz |
koz |
Total Probable |
3,632 |
5.45 |
19.1 |
637 |
2,231 |
Notes for Table 5: CIM Definition Standards were
followed for classification of Mineral Reserves |
|
|
1. |
A mean bulk density of 2.85 t/m³ is used for Premier and of 2.80
t/m³ for all other deposit areas |
2. |
The AuEq values were calculated using US$1,400/oz Au and a US$17/oz
Ag and the following equation: AuEq(g/t) = Au(g/t)+ Ag(g/t) x 17 /
1,400 |
3. |
The following CoG based on AuEq grade were used to estimate the
economic potential of the stopes: Longhole = 2.85 g/t, Inclined
undercut Longhole = 3.44 g/t, cut and fill = 3.44 g/t, room &
pillar = 3.82 g/t and development = 2.85 g/t |
Table 6: RMP Mineral Reserve Statement
|
|
Grade |
Contained Ounces |
|
Tonnes |
Au |
Ag |
Au |
Ag |
kt |
g/t |
g/t |
koz |
koz |
Proven |
2,194 |
6.68 |
21.7 |
471 |
1,530 |
Probable |
351 |
5.51 |
13.8 |
62 |
155 |
Total Proven and Probable |
2545 |
6.52 |
20.6 |
534 |
1685 |
Notes for Table 6 CIM Definition Standards
were followed for classification of Mineral Reserves |
|
|
1. |
The AuEq values were calculated using US$1,300/oz Au and a US$15/oz
Ag and the following equation: AuEq(g/t) = Au(g/t) + Ag(g/t) x 15 /
1,300 |
2. |
The following CoG based on AuEq grade were used to estimate the
economic potential of the stopes: Longhole = 3.11 g/t, Inclined
undercut Longhole = 4.0 g/t, cut and fill = 4.1 g/t and development
= 3.11 g/t |
Metallurgical & Processing
Overview
An overview schematic of the processing facilities,
with both existing infrastructure (in blue) and new construction
(in yellow) is shown below:
Figure 1: Premier Plant Area
- https://www.globenewswire.com/NewsRoom/AttachmentNg/9aee84ad-2ff8-4d30-976d-618ba74b45c0
During 2019, an engineering assessment was
conducted by CGT Industrial on the existing processing facility to
establish its working condition and provide the basis for the
recently completed Study.
The existing plant arrangement is suitable for a
semi autogenous grinding (“SAG”) and ball milling
flowsheet followed by the refurbished carbon-in-leach circuit.
Over the mine life, the plant will operate 365 days a year to
produce gold doré with an overall plant availability of 92% and an
average throughput of 2500 tpd. In the latter part of year three,
ore from RMP will be introduced to the existing mill facility.
Ore will be fed from either one of the PGP or
the RMP stockpiles using a campaigning methodology. Ore from
PGP will be primary crushed, stockpiled and fed into the existing
SAG and Ball Milling arrangement to be ground to a particle size
(“P80”) of 80 microns
(“µm”). An integrated gravity circuit will
remove coarse gold for cyanidation in the intensive leach reactor
(“ILR”) with the remainder to be cyanide leached
in a conventional CIL circuit. Gold will be recovered on
carbon, eluted and then electro-won to produce a silver/gold doré.
Gold recovered from the ILR will be electro-won separately to
produce a separate gold doré.
Leached tails will be detoxified in an Air and
Sulphur Dioxide cyanide destruction circuit, then thickened and
pumped to a tailings storage facility (“TSF”).
Raw water required for fresh water make-up is pumped to the
plant from Cascade Creek whilst process water is recovered from the
TSF decant water, which will be used for grinding and utility
water.
For the processing of the RMP ores, the initial
circuit flow sheet will be adapted in the latter part of year two
of production. Gravity recoverable gold is absent from the
RMP ore; therefore, the gravity circuit will be bypassed whilst
processing this ore. The RMP gold and silver recovery is
sensitive to grind size, and as such a P80 target of 25µm is
required to optimize precious metals recoveries in the leaching
circuit. In order to achieve the targeted fine grind, a
tertiary/fine stirred mill will be installed in the plant.
The grinding circuit product will require thickening prior to
introduction to the CIL circuit. Based on the current and
historical test work, a 27-meter diameter pre-leach thickener will
be required for this application. When PGP ores are
campaigned, the fine grinding circuit will be bypassed.
Estimated gold and silver recoveries used for the design of the
processing facilities are shown in Table 7 below.
Table 7: Recovery by Deposit
|
PGP plant gravity and leach recovery |
RMP plant leach recoveries |
LOM average |
|
Au % |
Ag % |
Au % |
Ag % |
Au % |
Ag % |
Premier |
98.4 |
69.2 |
|
|
|
|
Silver coin |
94.5 |
74.2 |
|
|
|
|
Big Missouri |
93.5 |
68.6 |
|
|
|
|
Marc |
- |
- |
91.9 |
89.7 |
|
|
AV |
- |
- |
80.6 |
75.5 |
|
|
JW |
- |
- |
90.1 |
87.5 |
|
|
Average |
95.4 |
71.5 |
86.8 |
83.6 |
91.4 |
76.5 |
Tailings and Water
Management
Tailings will be managed in the existing
Tailings Storage Facility (“TSF”) that will be
progressively raised to store 100% of the tailings during the
design operating life. Knight Piésold is the Engineer of
Record for the TSF. Upgrades to the TSF include modification
of water management structures, additional material added to the
embankment to flatten the slopes to meet current codes, and
installation of new tailings distribution and reclaim water
systems.
Non-contact water diversion structures located
upstream of the TSF will be upgraded to minimize flood routing
through the TSF. Site surplus water and underground
dewatering will be directed to the new water treatment plant for
treatment as required prior to release.
Capital Costs
The Project benefits from significant existing
infrastructure, which helps reduce the initial capital cost.
Total initial pre-production capital cost (capex) is C$146.6M
inclusive of construction indirect costs,
engineering-procurement-construction- management (“EPCM”),
contingencies and owners’ costs. The mobile equipment is leased and
these costs have been included in the operating costs. The
sustaining capital is C$157.3M inclusive of mine development
capital, road construction to RMP, and process plant modifications
for the fine grind and additional pre-leach thickener. The
total life of mine capex is C$324M inclusive of closure costs.
Underground mining and haulage are anticipated to be
completed using an owner-operator development model operating 365
days per year. Table 8 shows the capital cost
breakdown.
Table 8: Project Capital Cost Estimate
(C$M)
|
Initial |
Sustaining |
LOM Total |
Mine |
14.0 |
110.2 |
124.2 |
Processing |
35.6 |
10.3 |
45.9 |
On-Site Services |
50.4 |
20.3 |
70.7 |
Tailings & Water Management |
15.7 |
9.3 |
25.0 |
Roads |
5.9 |
0.0 |
5.9 |
Site Services & water treatment * |
28.8 |
11.0 |
39.8 |
Total Directs |
100.0 |
140.9 |
240.9 |
Indirects (EPCM, Contingency, Owners Costs) |
46.6 |
16.3 |
62.9 |
Total Directs + Indirects |
146.6 |
157.1 |
303.7 |
Additional Costs |
|
|
|
Closure |
|
20.5 |
20.5 |
Project Total |
|
|
|
Grand Total |
146.6 |
177.6 |
324.2 |
* includes
the RMP road |
|
|
|
Operating Costs
Life of mine operating costs for the project
were developed from first principles for mining, processing, site
services and administration using the mine and processing plans,
incorporating development rates, labour, materials, consumables,
and certain contract services for a 2500 tpd processing rate.
Processing cost in year 3 increases by $4.25 per tonne processed
due the higher grinding requirements for harder ore from RMP.
Table 9 shows the breakdown of LOM operating costs.
Table 9: Project LOM Operating Costs
(C$/t milled)
Operating Costs |
CAD$/t |
US$/oz Au |
Mining Cost |
97.00 |
430 |
Processing Cost |
31.05 |
138 |
G&A Cost |
7.93 |
35 |
Site Services Cost |
3.36 |
15 |
Royalties |
15.30 |
68 |
Refining & Transportation |
0.90 |
4 |
By-product Credits |
-10.74 |
-48 |
Total Cash Cost |
144.81 |
642 |
Permitting Process
PGP is currently in care and maintenance with
existing permits for continued reclamation and mine water
discharge. The site has been maintained in good standing with
reclamation activities and environmental monitoring ongoing.
In 2018 and 2019, Ascot undertook additional environmental baseline
monitoring and data collection to support permit amendments for the
Mine’s Act and the Environmental Management Act, and several
ancillary permits, which will be required to bring PGP back into
operation. In 2018, Ascot received confirmation from both the
BC Environmental Assessment Agency and the Canadian Environmental
Assessment Agency that PGP will not need to undergo an
environmental assessment pursuant to provincial and federal
environmental assessment legislation. Nisga’a Lisims
Government (NLG) confirmed that an assessment of
the impacts of the proposed PGP and amendments to the proposed RMP
on Nisga’a Nation treaty interests will need to be conducted
pursuant to the Nisga’a Final Agreement.
In 2019, RMP received federal approval and
issuance of a provincial Environmental Assessment Certificate
(“EAC”). The decision also included a
determination of the potential effects of the Nisga’a Final
Agreement (2000). RMP will next require issuance of the
necessary statutory permits and authorizations to commence
construction of the project. Any changes to the project
description, resulting from coupling activities or toll milling
with PGP, will first require an amendment to the RMP EAC before
proceeding to detailed design and ensuing permit applications.
Aboriginal and Community
Stakeholders
PGP is located in the Nass Area and RMP is
located in the Nass Wildlife Area, as defined in the Nisga’a Final
Agreement (2000), a modern treaty between the federal government,
provincial government, and Nisga’a Nation, which sets out Nisga’a
Nation’s rights under Section 35 of the Canadian Constitution
Act. Nisga’a Nation’s Treaty rights under the Nisga’a Final
Agreement include: establishing the boundaries and the Nisga’a
Nation’s ownership of Nisga’a Lands and Nisga’a Fee Simple Lands;
water allocations; the right of Nisga’a citizens to harvest fish,
wildlife, plants and migratory birds; and the legislative
jurisdiction of the NLG. Nisga’a citizens have Treaty rights
to manage and harvest wildlife in the Nass Wildlife Area and to
harvest fish, aquatic plants, and migratory birds within the Nass
Area. The clarity and certainty provided by the Nisga’a Final
Agreement, including Chapter 10, which sets out the required
processes for the assessment of environmental effects on Nisga’a
Nation Treaty rights from projects such as this one, is a major
advantage to development.
The nearest communities to RMP and PGP are the
town of Stewart, British Columbia and the village of Hyder, Alaska.
Both communities have a long-standing history with mining
projects and have historically been supportive of mining
activities. Broader stakeholders may include overlapping
tenure holders (such as trapline holders, guide outfitters, and
independent power producers), local and regional governments, and
government regulatory agencies.
Ascot is committed to meaningful, timely and
transparent engagement and consultation with the NLG, community
members, stakeholders and the public. Ascot will maintain
this commitment throughout the proposed development, construction,
operation and closure of the Project.
Project Opportunities and Value
Enhancements
The Study focused on existing indicated mineral
resources and utilized proven conventional mining and processing
methods. The Study did not consider potential alternatives or
additional resources to improve value. During the course of
study, a number of value enhancements to the project were
identified, including:
- Reducing mining dilution and
development by undertaking further studies and testing of an
emerging mining method called the shallow angle mining system
(“SAMS”) which is currently being tested by its
developer Minrail at Eldorado Gold Corporation’s Lamaque Mine in
Val D’or Quebec. SAMS is similar to Alimak mining but at a
low angle, with a central drive and long holes drilling laterally,
offering the potential to significantly reduce dilution, operating
costs and mine capital development costs;
- Conversion of inferred resources
that could extend the mine life and increase throughput rates.
The resource inventory of the Premier, Silver Coin and Big
Missouri deposits currently contains 4.173Mt in the Inferred
Category. Approximately 2.2Mt of inferred resources
(approximately 53%) are located within 100 metres of existing or
planned underground development. The Company will focus on
converting these resources to the Indicated Category and make them
available for conversion to reserves in future mine plans;
- Completion of testwork
opportunities to further optimize the reagent consumption rates
over the processing cycle which could reduce processing costs;
- Completion of value enhancement
studies that will potentially lower the capital and operating costs
particularly for the RMP ore that will be introduced in
approximately year 3 of production.
Recommendations and Next
Steps
Given the positive economics of the Project and
potential for further value enhancements to the Project economics,
the Company will continue to advance the Project towards
development. Ascot will seek funding from capital sources for
the construction and development of the Project over the coming
months. In addition, the Company will do the following
activities:
- Continue working with NLG and
Provincial regulators to promote a cooperative and mutually
respectful relationship to advance the permit amendment
applications for PGP;
- Continue with the optimization of
the project execution and construction schedule, including
procurement and permitting;
- Commencement of further detailed
engineering and design activities to investigate value enhancements
to the project noted above;
- Continue additional drilling to
advance the discovery and conversion of additional resources on the
project sites.
Qualified Persons and NI 43-101 Disclosure
John Kiernan, P.Eng., Chief Operating Officer of
the Company is the Company’s Qualified Person (QP) as defined by
National Instrument 43-101 and has reviewed and approved the
technical contents of this news release.
The NI 43-101 Feasibility Study Technical Report
is being prepared in accordance with NI 43-101 and will be filed
under the Company’s profile on SEDAR within 45 days of this press
release. The Qualified Persons have reviewed and verified
that the technical information in respect to the Feasibility Study
in this press release is accurate and approve the written
disclosure of such information.
The Qualified Persons who will prepare the
Technical Report are:
Sacre Davey Engineering Inc. |
Frank Grills, P.Eng. |
Sacre Davey Engineering Inc. |
Shervin Teymouri, P.Eng. |
Sedgman Canada Ltd. |
Aleksandar Petrovic, P.Eng. |
SRK Consulting (Canada) Inc. |
Soren Jensen, P.Eng. |
Knight Piésold Ltd. |
Jim Fogarty, P.Eng. |
McElhanney Ltd. |
Brendon Masson, P. Eng. |
Mine Paste Ltd. |
Frank Palkovits, P.Eng. |
Bird Resource Consulting Corp
(BRCC) |
Susan Bird, P.Eng. |
ARSENEAU Consulting Services
(ACS) |
Gilles
Arseneau, P.Geo. |
Palmer Environmental Consulting
Group Inc |
Rob Marsland, P. Eng |
Company Webcast & Conference
Call
Ascot will be hosting a webcast and
teleconference on April 16th at 1:15 pm PT/4:15 pm
ET. Ascot’s CEO, Derek White will be available to answer
questions at the end of the call.
The webcast can be accessed through the Investor
page of Ascot’s web site or by clicking on the following link:
http://services.choruscall.ca/links/ascot20200415.html. The live
call may be accessed by dialing 1-800-319-4610 for North
American callers, or 1-604-638-5340 for
International callers. Callers should dial
in five to ten minutes prior to the
scheduled start time, and ask to join the “Ascot Resources
Conference Call.” The webcast will be available on demand at
the same link for 3 months following the live event.
We look forward to providing you with a more
comprehensive update at that time, including discussing the results
of the Feasibility Study. In the meantime, if you have any
questions, please do not hesitate to email Kristina Howe, our VP of
Investor Relations.
ON BEHALF OF THE BOARD OF DIRECTORS OFASCOT RESOURCES
LTD.
“Derek C. White”, President and
CEO
For further information contact:Kristina Howe
VP, Investor Relations 778-725-1060 / khowe@ascotgold.com
About Ascot Resources Ltd.
Ascot is a Canadian-based exploration and
development company focused on re-starting the past producing
historic Premier gold mine, located in British Columbia's Golden
Triangle. The Company continues to define high-grade
resources for underground mining with the near-term goal of
converting the underground resources into reserves, while
continuing to explore nearby targets on its Premier/Dilworth and
Silver Coin properties (collectively referred to as the Premier
Gold Project). Ascot's acquisition of IDM Mining added the
high-grade gold and silver Red Mountain Project to its portfolio
and positions the Company as a leading consolidator of high-quality
assets in the Golden Triangle.
For more information about the Company, please
refer to the Company’s profile on SEDAR at www.sedar.com or visit
the Company’s web site at www.ascotgold.com, or for a virtual tour
visit www.vrify.com under Ascot Resources.
The TSX Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this
release.
Cautionary Statement Regarding Forward-Looking
Information
All statements, trend analysis and other
information contained in this press release about anticipated
future events or results constitute forward-looking statements.
Forward-looking statements are often, but not always, identified by
the use of words such as “seek”, “anticipate”, “believe”, “plan”,
“estimate”, “expect” and “intend” and statements that an event or
result “may”, “will”, “should”, “could” or “might” occur or be
achieved and other similar expressions. All statements, other than
statements of historical fact, included herein are forward-looking
statements, including statements in respect of the closing of the
Private Placement and the use of proceeds. Although Ascot believes
that the expectations reflected in such forward-looking statements
and/or information are reasonable, undue reliance should not be
placed on forward-looking statements since the Ascot can give no
assurance that such expectations will prove to be correct. These
statements involve known and unknown risks, uncertainties and other
factors that may cause actual results or events to differ
materially from those anticipated in such forward-looking
statements, including the risks, uncertainties and other factors
identified in the Ascot’s periodic filings with Canadian securities
regulators, and assumptions made with regard to: the estimated
costs associated with construction of the Project; the timing of
the anticipated start of production at the Projects; the ability to
maintain throughput and production levels at the Premier Mill; the
tax rate applicable to the Company; future commodity prices; the
grade of Resources and Reserves; the ability of the Company
to convert inferred resources to other categories; the ability of
the Company to reduce mining dilution; the ability to reduce
capital costs. Forward-looking statements are subject to business
and economic risks and uncertainties and other factors that could
cause actual results of operations to differ materially from those
contained in the forward-looking statements. Important factors that
could cause actual results to differ materially from Ascot’s
expectations include risks associated with the business of Ascot;
risks related to exploration and potential development of Ascot’s
projects; business and economic conditions in the mining industry
generally; fluctuations in commodity prices and currency exchange
rates; uncertainties relating to interpretation of drill results
and the geology, continuity and grade of mineral deposits; the need
for cooperation of government agencies and indigenous groups in the
exploration and development of properties and the issuance of
required permits; the need to obtain additional financing to
develop properties and uncertainty as to the availability and terms
of future financing; the possibility of delay in exploration or
development programs and uncertainty of meeting anticipated program
milestones; uncertainty as to timely availability of permits and
other governmental approvals; risks associated with COVID-19
including adverse impacts on the world economy, construction timing
and the availability of personnel; and other risk factors as
detailed from time to time and additional risks identified in
Ascot’s filings with Canadian securities regulators on SEDAR in
Canada (available at www.sedar.com). The timing of future economic
studies; labour disputes and other risks of the mining industry;
delays in obtaining governmental approvals, financing or in the
completion of Project as well as those factors discussed in the
Annual Information Form of the Company dated March 13, 2020
in the section entitled "Risk Factors", under Ascot’s SEDAR profile
at www.sedar.com. Forward-looking statements are based on estimates
and opinions of management at the date the statements are made.
Ascot does not undertake any obligation to update forward-looking
statements.
Note to United States Investors
Concerning Estimates of Measured, Indicated and Inferred
Resources
Mineral resources that are not mineral reserves
do not have demonstrated economic viability. Mineral resource
estimates do not account for mineability, selectivity, mining loss
and dilution. It is reasonably expected that the majority of
inferred mineral resources could be upgraded to indicated mineral
resources with continued exploration; however, there is no
certainty that these inferred mineral resources will be converted
into mineral reserves, once economic considerations are applied.
The mineral resource estimates referenced in this release use the
terms "Indicated Mineral Resources" and "Inferred Mineral
Resources". While these terms are defined in and required by
Canadian regulations (under NI 43-101), these terms are not
recognized by the U.S. Securities and Exchange Commission ("SEC").
"Inferred Mineral Resources" have a great amount of uncertainty as
to their existence, and great uncertainty as to their economic and
legal feasibility. The SEC normally only permits issuers to report
mineralization that does not constitute SEC Industry Guide 7
compliant “reserves” as in-place tonnage and grade without
reference to unit measures. U.S. investors are cautioned not to
assume that any part or all of mineral deposits in these categories
will ever be converted into reserves. Ascot is not an SEC
registered company.
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