BRITISH COLUMBIA – Almaden Minerals of Vancouver says according to the preliminary economic assessment of its Elk (formerly Siwash) gold project near Merritt could pay for itself in less than two years. Using a US$1,000/oz gold price and a production rate of 139,000 oz/y and cash operating costs of C$528/oz, the PEA estimates a pre-tax internal rate of return at 51%. Initial capital expenditures would be C$9.9 million to develop an open pit and restart the 500-t/d mill.
The PEA examined an alternate scenario using a gold price of US$1,200/oz. In that case production would be 297,000 oz/y and cash operating costs C$652/oz. Capital expenditures would be higher at $17.5 million, and payback would be 3.3 years. The second set of assumptions would also lengthen the mine life to nine years from seven years.
Almaden said in a news release that prospecting activities in the project area date back to the early 1900s, but detailed work in the area began in 1960s and 1970s by several companies hunting for copper and molybdenum. Approximately 51,500 oz of gold were produced between 1992 and 1995 from a test pit and underground mining exploration (a decline was excavated for underground drilling activity, but no stoping or underground mining occurred).
Read the latest exploration results at www.AlmadenMinerals.com.