Name of the Project
Magino gold project.

Location
The project is located 40 km north-east of Wawa, Ontario, Canada.

Project Owner/s
Canada-based mining company Argonaut Gold.

Project Description
Magino is a past-producing underground gold mine.

The project has total proven and probable reserves of 59-million ounces grading 1.13 g/t gold. A feasibility study on the project has identified it as a strategic, long-life asset.

Envisaged is a 115 700 oz/y gold operation with a 17-year mine life. Average gold production of 150 000 oz/y is expected over the first five years.

Openpit mining operations will use a fleet comprising 16 m³ front shovels, a 13 m³ front-end loader and 140 t haul trucks. This fleet will be supplemented by drills, and graders, as well as track and rubber-tyre dozers.

A 10 000 t/d processing facility has been selected for the feasibility study, compared with the 30 000 t/d plant presented in the January 2016 prefeasibility study.

The adopted flowsheet includes primary crushing, single-stage semiautogenous grinding mill, a gravity recovery circuit, a cyanide leach and carbon-in-pulp gold adsorption circuit with cyanide recovery and detoxification, as well as thickening, before tailings are discharged to a tailings facility.

Potential Job Creation
During construction, about 500 to 600 jobs will be created and about 350 employees will be engaged as part of ongoing operations.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 5% discount rate, of $408-million and an internal rate of return of 22.6%, with a payback of 3.8 years.

Capital Expenditure
In December 2021, Argonaut Gold announced a new capital cost estimate of C$800-million for the Magino project – a C$290-million increase on the previous estimate.

Planned Start/End Date
Argonaut envisions a two-year construction period, with first gold production at Magino expected to start during the first half of 2023.      

Latest Developments
Owing to the C$290-million cost increase in the Magino project, Argonaut has said that it expects a funding shortfall to see the project through to completion.

Argonaut is now conducting an immediate review of financing and strategic alternatives.

VP corporate development and investor relations Dan Symons has said that the Magino project is no exception to the cost increases, inflation and Covid-19 impacts reported across the industry, with these accounting for about 32% of the capital increase.

Changes in scope account for about 28% of the capital expenditure (capex) increase and primarily relate to site development, the tailings management facility and permanent power. About 20% of the capex increase relates to increases in quantities.

There has also been a cost involved for compressing the schedule, after work on the processing facility fell behind owing to civil works challenges. Compressing the schedule to meet the initial target of first gold pour by March 2023 was deemed to be more economic than delaying the overall project.

Argonaut was cleared in early 2021 to start site preparation for construction of Magino.

Key Contracts, Suppliers and Consultants
Ausenco Engineering Canada (engineering, procurement, construction and commissioning).

Contact Details for Project Information
Argonaut Gold, tel +1 775 284 4422, fax +1 775 284 4426 or email info@argonautgold.com.