Mother Lode site Credit: Corvus Gold
Early stage economic studies on standalone operations at Corvus Gold’s North Bullfrog and Mother Lode gold projects in southwest Nevada suggest potential for the junior to be the first producer in the Bullfrog mining district. Starting with development at the ‘high margin’ North Bullfrog, the twin preliminary economic assessments (PEAs) also show potential for a second operation at Mother Lode.
At North Bullfrog, the latest mine design calls for a low strip ratio, 43,300 t/d run-of-mine heap-leach operation, mining four deposits, with a grinding circuit for gravity gold recovery from higher-grade areas. The heap-leach portion of the operation would generate an average of 80,290 gold oz. in the first seven years of operations, while the mill would add a further 66,710 gold oz. annually for total production of 147,000 oz. a year in the first seven years of the 14-year mine.
With all-in sustaining costs pegged at US$727 per oz. in the first seven years, and an initial capital cost of US$167 million, the after-tax net present value estimate for the project comes in at US$452 million, at a 5% discount rate, with a 47% internal rate of return. The study used a gold price of US$1,500 per oz. gold.
A separate early-stage study for Mother Lode, 10 km from North Bullfrog, outlines an 8-year, 19,600 t/d open pit mine, with a heap leach pad for the oxide mineralization and a biological oxidation mill for the higher-grade sulphide mineralization. This operation would generate an average of 49,700 gold oz. annually from the heap leach and a further 121,800 oz. a year from the mil, for a total average output of 170,980 oz. annually.
With all-in sustaining costs of US$677 per oz. in the first three years and an initial capital cost of US$406 million, the after-tax net present value estimate for the development stands at US$303 million, at a 5% discount rate and based on US$1,500 per oz. gold, with a 23% internal rate of return.
The junior says North Bullfrog is the “initial mine development target for Corvus because of its expected low initial capital requirements, potential high margins and anticipated strong free cash flow generation, that could provide development capital for the company’s potential second mining project at the Mother Lode deposit.”
In a release, Corvus president and CEO Jeffery Pontius noted the significance of Corvus’s projects within the Bullfrog district.
“The North Bullfrog PEA study has highlighted a re-emergence of the Bullfrog gold district and with Corvus Gold’s commanding land position, we believe we have the district’s dominant asset base with excellent growth potential for our shareholders.”
Looking at Mother Lode (MLP), according to the release, this asset may “provide Corvus with a future production growth option to increase its gold production profile in the Bullfrog mining district beyond its initial mining project at North Bullfrog. MLP could position Corvus for expanding organic production growth and possible further district consolidation of other assets.”
The company plans to continue with resource expansion work and discovery drilling on priority targets at both North Bullfrog and Mother Lode through next year.
In addition to the PEAs, Corvus released updated pit-constrained resource estimates for both North Bullfrog and Mother Lode, estimated at US$1,500 per oz. gold.
North Bullfrog is now host to 24.7 million measured and indicated tonnes in the milling category, at 1.31 g/t gold and 8.6 g/t silver, with a further 167.5 million tonnes, at 0.2 g/t gold and 0.65 g/t silver, in this classification designated for heap leach extraction. Inferred resources stand at 420,000 tonnes for mill processing, at 0.97 g/t gold and 7.96 g/t silver, with an additional 67.3 million inferred heap-leach tonnes at 0.19 g/t gold and 0.55 g/t silver.
At Mother Lode, measured and indicated resources for milling stand at 21 million tonnes, grading 1.49 g/t gold and 0.6 g/t silver, with an additional 39.3 tonnes in this category for heap leaching, at 0.44 g/t gold and 0.78 g/t silver. Inferred resources add 2.9 million tonnes of millable material, at 0.9 g/t gold and 1.77 g/t silver, with a further 7 million inferred tonnes for heap leaching, at 0.4 g/t gold and 1.26 g/t silver.
For more information, visit www.CorvusGold.com.