GOLD: Ascot feasibility shows strong economics for Golden Triangle projects

BRITISH COLUMBIA – Ascot Resources has released the results of a feasibility study for its wholly owned Premier and Red Mountain projects within the province’s Golden Triangle area, suggesting four underground mines at the Silver Coin, Big Missouri, Premier and Red Mountain deposits.

With a proposed restart of the Premier mill at a 2,500 t/d throughput, the resulting operation would produce an average of 132,375 oz. of gold and 370,500 oz. of silver annually over an 8-year life at all-in sustaining costs of US$769 per oz. Given an initial capital cost estimate of $146.6 million, the resulting net present value for the project, at a 5% discount rate, stands at $341 million with a 51% internal rate of return.

“The study focused on maximizing the project economics, which involved optimizing mining methods and development to reduce operating cost per ounce,” Derek White, the company’s president and CEO, said in a release. “The result of this optimization was a conversion of 64% of indicated resources to reserves at Premier. Management believes that future underground drilling will help to improve conversion of some of the remaining inferred resources and improve annual production rates.”

Three of the deposits are at Premier and one is at the Red Mountain site, 23 km southeast. Premier is a past-producing site and would require amendments to existing permits while Red Mountain requires both amendments and new permits.

With proposed side hill portal access and long hole stoping as the mining method, mining would start at the Silver Coin and Big Missouri deposits and later incorporate ore from Red Mountain and Premier.

The feasibility envisions refurbishing the existing processing facility at Premier and successive raises of an existing tailings storage facility at the site.

Reserves at the Premier project stand at 3.6 million tonnes grading 5.45 g/t gold and 19.1 g/t silver for a total of 637,000 oz. of gold and 2.2 million oz. of silver. Red Mountain reserves stand at 2.5 million tonnes grading 6.52 g/t gold and 20.6 g/t silver, totalling 534,000 oz. gold and 1.7 million oz. silver.

Ascot sees further upside for the project from potentially using a shallow angle mining method to reduce dilution and development capital as well as from both resource growth and resource conversion.

The company now plans to optimize the project schedule and start additional engineering and design work; it plans to seek funding for construction and development of the project in the near term.

For more information, visit www.AscotGold.com.