Canadian Mining Journal


COPPER-GOLD: Ootsa PEA points toward low-cost producer for Gold Reach

BRITISH COLUMBIA – Gold Reach Resources of Vancouver says the preliminary economic assessment for the Oosta copper-gold-molybdenum project adjacent to the Huckleberry mine and mill, 120 km south of Houston, points toward development of a low cost producer.

With an initial capex investment of C$64 million including contingency, three sequential pits could be contract mined followed by toll milling for a period of 12 years. The project will generate a base case after tax net present value of $186 million and an internal rate of return of 81%.

The base case assumes metal prices of US$3.00/lb for copper, US$1,250/oz for gold, US$10.30/lb for moly, and US$17/oz for silver. All-in sustaining costs per lb of copper are estimated to be US$2.09.

Gold Reach anticipates that engineering, environmental studies and permitting of the Ootsa project would take three to four years. Securing a toll milling contract may be problematic as the adjacent Huckleberry mill is due to be closed at the end of August 2016.

If a lack of toll milling facilities slows the Ootsa project, the resources will remain in the ground. The three deposits have total measured and indicated material of 224.2 million tonnes with a copper equivalent of  0.37% plus an inferred resource of 5.2 million tonnes at 0.30% CuEq. The M&I portion is estimated to contain 1.11 billion lb of copper, 1.1 million oz of gold, 104.0 million lb of molybdenum, and 20.4 million oz of silver.

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