There looks to be another mine-ready gold project in the Timmins camp.
Toronto's Galleon Gold released the results on Jan, 12 of a preliminary economic assessment (PEA) for its West Cache Gold Project, proposing an underground mine with an 11-year operating life, built at a very low cost of $150 million.
A PEA is only a first-stage conceptual plan of what a mine could look like.
Galleon hasn't made an official construction decision yet but the company is confident enough to believe it can start test mining within two years. They will proceed to the next stage of technical evaluation in carrying out a pre-feasibility study.
The 3,765-hectare West Cache Project is 13 kilometres west of the city and seven kilometres from Pan American Silver's Timmins West Mine. Highway 101 runs across the property. The area has been well-explored ground since the 1920s.
Over its mine life, the PEA said West Cache is estimated to deliver 940,200 ounces of gold, averaging out to annual production of 85,500 ounces. The recovered mill ounces of gold is estimated at 893,200 ounces over its life.
Commercial production is pegged at 2,400 tonnes per day.
The cash cost is US$814 per ounce with an all-in sustaining cost of US$987 per ounce.The PEA is based on a gold price of US$1,700 an ounce.
The mine construction costs do not include a processing plant or a mine waste - tailings - storage facility.
Initially, the company is considering contracting an outside mill operator to process its mineralized ore, but if the gold resource grows at West Cache they could opt for an on-site plant.
For the waste rock, the plan is to backhaul the tailings from the processing plant to West Cache to use as backfill below ground.
Galleon also released a new mineral resource estimate that boosts the indicated mineral resource to 472,000 ounces with an average grade of 3.63 grams per tonne (g/t) of gold. The inferred mineral resource of 1,088,000 ounces at average grade of 2.87 g/t.
The West Cache deposit extends down one kilometre from surface with gold to be extracted from 20 different spots within a 2.5-square-kilometre area. The operation would be divided into four mining areas - A to D - with separate access portals from the surface for each one and ramps running down to the deposit.
The mining method would be longhole retreat stoping with cemented hydraulic backfill.
The operation would use 30-tonne trucks with 7 and 10-tonne load-haul-dump units.
In the meantime. Galleon plans to improve the certainty of its gold resource by infill drilling as well as drilling for new mineralized shoots further out from the deposit. They also plan to take a bulk sample to better figure out the mineralogy and processing plans.
In a news release, Galleon CEO R. David Russell seemed pleased that West Cache has the economics to support a profitable operation. He mentioned the mineral potential is there to continue mining beyond 11 years by exploring further out from the deposit and going deeper.
"Based on our geologic model, I believe West Cache has the potential to extend the (life of mine) beyond the initial 11 years by expanding the mineral resource downdip and along strike. Moreover, we have explored less than 10 per cent of the property and recent geological interpretations suggest we should be looking to pursue new exploration targets in untested host rock both north and south of the current mineral resource," said Russell in a statement.
"Our primary exploration goal for 2022 is to add high grade gold ounces and expand the Mineral Resource through surface drilling. In early to mid-2023, pending permits, we plan to commence underground test mining the high-grade Zone #9 area.”
Company management will offer more details in a webcast on Jan, 13 at 11 a.m.