ONTARIO — Vancouver's Northgate Minerals says the results of the pre-feasibility study on the Young-Davidson gold project 60 km west of Kirkland lake are positive, according to the study done by AMEC Americas. Northgate is planning both open pit and underground mines as well as a 6,000-t/d mill. Average annual production would be at least 170,000 oz of gold at a net cash cost of US$333 per oz.
The Young-Davidson project carries a pre-production capital cost of US$ 293 million and sustaining capital needs of US$159 million during a planned 15-year life. Pre-tax operating cash flow is estimated to US$548 million yielding an internal rate of return (IRR) of 13.2%. The project would pay for itself in 6.4 years after the start-up of full production in early 2012. (All numbers are based on US$725/oz gold.)
Proven and probable reserves at Young-Davidson contain an estimated 2.8 million oz of gold. Or stated another way, there are 31.1 million tonnes of ore averaging 2.75 g/t Au and 0.77 g/t Ag.
During the first two years of mining, feed for the mill will be sourced from a small open pit. The open pit design incorporates 5-metre-high benches with 19-metre-wide haul roads, which will accommodate 55-tonne trucks. The stripping ratio for the open pit is 2.75:1. Production from the underground mine will be phased in during year three as the pit ore reserve is exhausted. For the last 12 years of the projected mine life, mill feed will be provided exclusively from the underground mine.
The underground ore deposit is located between a depth of approximately 210 to 1,500 metres. A new 6-metre-diameter shaft will be sunk east of the deposit to a depth of 1,500 metres and will provide for the hoisting of ore and waste and the supply of ventilation. The mine will also be accessed by a ramp, which will be extended to the bottom of the mine from the existing exploration ramp, currently at a depth of 460 metres below surface.
The mine has been designed for bulk mining methods and unconsolidated waste rock backfill. The mine will operate 20-tonne load-haul-dumpers (LHD) to transport muck to the ore pass system, and ore will be hoisted to the surface using 18-tonne skips. Waste rock for backfill will be distributed underground by gravity through a waste pass system extending from surface through to the lower levels and hauled to the stopes by the LHDs.
Gold will be recovered in a 6,000-t/d CIL plant with a single-stage autogenous grinding circuit. Gold recovery is estimated to average 92.5% over the life of the mine. A preferred on-land location for the tailings impoundment facility has been identified that incorporates and remediates a historic tailings site.
Surface facilities to support the Young-Davidson mine will include an administration/engineering building, a warehouse and a maintenance shop.
To view a schematic of the open pit and underground mine, visit www.NorthgateMinerals.com/Theme/Northgate/files/Releases/YD-LS-Jul-09.gif.