Tag Archives: JDS Energy and Mining

JDS Energy & Mining to run the PFS numbers at Gold Mountain’s Elk gold project

Gold Mountain Mining has engaged JDS Energy & Mining Inc to complete a prefeasibility study on its Elk gold project in British Columbia, Canada.

The PFS was commissioned to reflect the recent advancements the company has made to the project, most notably the signing of both the contract mining agreement – with Nhwelmen-Lake LP – and the ore purchase agreement with New Gold. These key inputs provide Gold Mountain with the near-term cost certainty required to delineate a maiden reserve at the project, the company says.

It is anticipated the PFS will also update the company’s resource estimate at the Siwash North Zone based on the results of its phase one drill program.

JDS will lead the PFS update with support from Knight Piesold Consulting and certain key independent consultants, Gold Mountain said, with the study expected to be completed in the September quarter.

Kevin Smith, Director and CEO of Gold Mountain, said: “We are very pleased to have JDS lead the PFS update. Their proven track record of engineering expertise in building ‘fit for purpose’ projects in Canada’s north will greatly contribute to the Elk gold project.

“Having a reputable group validate our economics, assess the underground potential, and continue to advance the Elk gold project strengthens our upside and ability to deliver long-term value to our shareholders.”

Gord Doerksen, President of the Engineering Division at JDS, added: “We are happy to be working with Gold Mountain to support near-term production and long-term planning at the Elk gold project. The team has built a strong foundation for JDS to add our extensive operational and permitting experience on a number of quality projects in British Columbia, and we look forward to maximising value together as partners.”

Gold Mountain acquired Bayshore Minerals in September 2020, gaining 100% ownership of the Elk gold project in the Merritt area of British Columbia. A past-producing gold mine, Elk comes with an NI 43-101 resource of 454,000 oz of gold-equivalent in the measured and indicated categories and 95,000 oz of gold-equivalent in the inferred category.

A previous preliminary economic assessment contemplated an operating able to mine 50,000 oz/y by year four.

Pure Gold moves onto engineering stage at Madsen Red Lake

Having recently secured the finance to develop its Madsen Red Lake gold project in Ontario, Canada, Pure Gold Mining has started to secure contractors to build the mine.

The company has awarded the surface engineering and procurement (EP) contract to JDS Energy & Mining in partnership with Hatch and Knight Piesold, while Dumas Mine Contracting has secured the underground mine design engineering contract.

Just last month, Pure Gold Mining secured a $90 million project financing package with Sprott Resource Lending Corp that, on top of money already raised, more than covers the C$95 million ($72 million) in upfront capital required to build the mine. This will be put towards redeveloping the old mine workings, adding additional development levels and investing in a new fleet – much of which could be battery-electric.

With the engagement of its engineering partners, the company says it has commenced construction at Madsen, which is due to produce an average of 80,000 oz/y of gold at an all-in sustaining cost of $787/oz.

“Detailed design work on surface infrastructure, as well as underground electrical distribution, mine ventilation, mine service design and stope optimisation has been initiated, as well as equipment sourcing and the procurement of long lead time items,” the company said.

Pure Gold Mining President and CEO, Darin Labrenz, said: “Madsen began as an exploration concept in late 2014, and has evolved into a multi-million ounce gold deposit that is now under construction as Canada`s highest grade gold development project. Along the way, the team has hit every milestone we set: from first resource estimate, to early conceptual studies, through a comprehensive feasibility study, an agreement with our First Nation partners, and now a fully funded financing package.

“Today, as we commence construction, our project is perfectly timed to benefit from a rising gold market, and looks set to generate well over C$800 million in cumulative pre-tax cash flow with gold currently near C$2,000/oz.”

Pure Gold Mining has also appointed Dimitry Demianyuk as Project Manager, Madsen Red Lake Mine. Demianyuk will work with the VP Operations, Ken Donner, providing engineering management and project management focused on the optimisation of project scope, budget, quality and schedule, Pure Gold said.

Demianyuk is an engineering professional with 15 years of industry experience in mine development at all project stages, having worked for established EPCM firms earlier in his career and then transitioning to specialise in project management and engineering management as part of owner’s teams at Rio Tinto, Frontera Mining, Newcrest Mining, and Nevsun Resources.

Barbara Womersley, meanwhile, has been engaged as a Human Resources Lead for the company.

Pure Gold looks at mine electrification options for Madsen underground project

In another sign that the underground mining space is increasingly going electric, Pure Gold Mining has said it intends to use a combination of diesel and battery-powered load and haul equipment at its Madsen underground gold project in Ontario, Canada.

The company said all ramp and level waste development would be performed by an owner-operated fleet of one- and two-boom electric hydraulic drill jumbos, 3 cu.m capacity LHDs, 20-t haul trucks, scissor lift/bolters and other rubber tyred support equipment.

Pure Gold said: “Mining will be facilitated by a combination of diesel and battery-powered equipment, with diesel equipment being utilised for upper levels of the mine prior to refurbishment of the existing shaft and installation of a new double-drum production hoist.”

Following the refurbishment, battery-powered equipment is likely to be used, with the company explaining that its use will “eliminate emissions associated with the movement of ore and waste and will result in materially reduced ventilation and heating requirements”.

This information came out in the company’s press release announcing a feasibility study on Madsen, a former operating gold mine in the renowned Red Lake district.

Based on a probable mineral reserve of 3.5 Mt at 9 g/t, containing 1 Moz of gold, the company outlined a 12-year operation at Madsen, producing an average of 80,000 oz/y at an all-in sustaining cost of $787/oz.

The initial capital requirement of C$95 million ($71 million) would be paid back with an after-tax net present value (5% discount) of C$247 million (using a gold price of $1,275/oz), the company said.

Darin Labrenz, President and CEO of Pure Gold, said: “The Madsen-Red Lake orebody is an exceptional foundation on which to build a gold mining company. With access to existing infrastructure, a high-grade reserve, and exceptional growth potential, Madsen is one of the outstanding gold deposits in Canada.”

He added: “The completed study outlines a long life high-margin mine, with low initial capital requirements and a fast timeline to production. In addition, specific exploration targets and satellite resources not considered in the feasibility study suggest an opportunity for near-term growth to potentially further enhance the economics of the project.”

The feasibility study supports a high-grade 800 t/d underground mining operation with designed stopes containing 1 Moz of probable reserves, the company said. Madsen benefits from significant mining, milling and tailings infrastructure already in place, resulting in one of the lowest capital intensity, undeveloped gold projects in the world, according to Pure Gold.

Mining will be conducted from new ramp development using a combination of cut and fill and longhole mining methods. A new hoist house and double drum production hoist will use the existing shaft infrastructure to hoist ore and waste from the mine, commencing in year four of operations.

The Madsen implementation schedule spans a period of 13 months, with underground mine development commencing approximately nine months before the first gold pour. The initial capital outlay of C$95 million (including contingency) supports the construction of an underground mine and associated infrastructure, including the expansion of existing milling capacity to 800 t/d of ore.

Assuming the project execution starts in April, the first gold production would be expected in May 2020.

JDS Energy and Mining led the feasibility study, which included contributions from consultants such as Knight Piésold, Nordmin Engineering, MineFill Services, Integrated Sustainability, Lorax Environmental Services, Ginto Consulting and Equity Exploration Consultants.