AuRico Metals Inc. is confident that a second gold-copper mine can be developed at its Kemess property, located approximately 300 km north of Burns Lake.
The company has recently received a positive preliminary economic assessment (PEA) for its Kemess East project. The project is located approximately one kilometre east of the Kemess Underground project, which received its environmental assessment certificate earlier this year.
“The release of a PEA on Kemess East represents another important step forward in highlighting to the market the value of the large resource base on our Kemess property,” said Chris Richter, AuRico Metals’ President and CEO. “It demonstrates the potential for a second large, long-life gold-copper mine with attractive economics at Kemess.”
The PEA presents a stand-alone scenario which does not incorporate the economics of the Kemess Underground project. However, AuRico Metals plans to conduct a feasibility study, expected to be released in 2018, which will evaluate both projects as part of an integrated development scenario. The combined feasibility study is expected to reflect further in-fill and expansion drilling planned at Kemess East this summer.
“We think the opportunity to combine the Kemess Underground project with the Kemess East project could unlock a number of synergies and optimization opportunities,” said Richter.
Kemess East has the potential to double the 12-year mine life of Kemess Underground or increase the scale of the project. The $683.9-million Kemess Underground project, expected to produce approximately 24,650 tonnes of ore per day, is expected to create between 300 and 400 full-time jobs.
”In a scenario where Kemess East expands Kemess Underground, one could see employment on site increasing substantially,” said Richter.
John Rustad, MLA for Nechako Lakes and Minister of Aboriginal Relations and Reconciliation, said First Nations in the area have already expressed full support of the Kemess Underground project going forward.
“They [AuRico Metals] have financing in place and they have now signed benefit agreements with First Nations in the area,” said Rustad. “It’ll take about five years to build the [Kemess Underground] project, but it will have solid mine life.”
The Kemess property has approximately $1 billion worth of existing infrastructure in place thanks to the Kemess South Mine, which operated from 1998 to 2011. Existing infrastructure includes offices, warehouse, maintenance facilities, a 400-person accommodation camp footprint, crushed ore stockpile and reclaim, access and service roads, airstrip, and electrical sub-station.