BRITISH COLUMBIA — The former Kitsault molybdenum mine, which operated from 1968 to 1972 and briefly from 1981 to 1982, may get a new lease on life. The pre-feasibility study (PFS) prepared by Wardrop for owner Avanti Mining of Toronto points toward a potentially profitable undertaking. The property is located in the Skeena District, 140 km northeast of Prince Rupert and contains three known deposits – Kitsault, Bell Moly and Roundy Creek.
The PFS includes an open pit mine with 215.3 million tonnes of proven and probable reserves. Mining will take place over 15 years, and a total of 368 million lb of moly will be produced. The initial capital cost is $641 million. Cash operating costs are estimated to be $4.43/lb of accountable molybdenum.
Wardrop's report puts the base case after-tax net present value (NPV) at $551 million with an internal rate of return (IRR) of 20.6%. Projected undiscounted net cash flow after taxes is $1.56 billion.
The Kitsault site has road access, which is approximately 12 km from ocean transport routes and is serviced by the BC Hydro transmission grid. The PFS estimates an annual mining rate of 14.6 million tonnes, or 40,000 t/d. The ore mined will be crushed in a gyratory primary crusher, then ground using a SAG-ball mill configuration. The moly concentrate will be dried and packaged into bags for shipment. The life of mine molybdenum production is estimated at 320,301 tonnes of molybdenum concentrate. Total molybdenum recovery is estimated at 90.6%.
Proven and probable reserves of 215.3 million tonnes grading 0.085% Mo have been outlined. There are also measured and indicated resources of 207.0 million tonnes grading 0.094% Mo, 5.06 g/t Ag, 0.024% Pb and 0.006% WO3. A conventional truck-and-shovel pit is planned.
Technical reports of the Kitsault project may be read at the company's website, www.AvantiMining.com.