Name of the Project
Eskay Creek gold/silver project.

Location
The project is located in the Golden Triangle of British Columbia, Canada.

Project Owner/s
TSX-V-listed Skeen Resources.

Project Description
A preliminary economic assessment (PEA) completed in 2019 has clearly demonstrated that Eskay Creek has the potential to become an economically viable project.

The PEA envisages an openpit mine, with on-site treatment of the mined material by conventional milling and flotation to recover a gold/silver concentrate for provision to third-party smelters. The mine will be an owner-operated, standard truck-and-shovel openpit, with a leased mining fleet. No contributions from previously reported underground resources are incorporated into this study.

The processing capacity of 6 850 t/d will result in a production life span of 8.6 years. An additional 1.5 years of prestripping, stockpiling and mine access development is planned before the processing facility becomes fully operational in Year 1.

Life-of-mine average production is estimated at 236 000 oz/y of gold and 5.81-million ounces of silver or 306 000 oz/y gold equivalent.

The PEA leverages Eskay Creek’s extensive existing infrastructure, including all-weather access roads, previously permitted tailing storage facilities and proximity to the recently commissioned 195 MW hydroelectric facilities and linked power grid.

Pit-constrained indicated mineral resources at a 0.7 g/t gold equivalent cutoff are estimated at 12.65-million tonnes grading 5.8 g/t gold equivalent, 4.3 g/t gold and 110 g/t silver. Inferred mineral resources are estimated at 14.42-million tonnes grading 2.9 g/t gold equivalent, 2.3 g/t gold and 47 g/t silver.

Underground indicated mineral resources at a 5 g/t gold equivalent cutoff are estimated at 819 000 t grading 8.2 g/t gold equivalent, 6.4 g/t gold and 139 g/t silver. Inferred mineral resources are estimated at 295 000 t grading 8.2 g/t gold equivalent, 7.1 g/t gold and 82 g/t silver.

Currently, no contributions from previously reported underground resources are incorporated into this study.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value, at a 5% discount rate, of $491-million and an internal rate of return of 51%, with a payback of 1.2 years.

Capital Expenditure
Preproduction capital expenditures are estimated at $233-million.

Planned Start/End Date
Not stated.

Latest Developments
Skeena Resources has started a preliminary feasibility study (PFS) for its Eskay Creek gold and silver project.

The goal of the PFS is to technically further derisk Eskay Creek while developing an appropriate execution strategy to ensure fast-tracked development towards commercial production.

Given the success of the team that developed the preliminary economic assessment (PEA) study for Eskay Creek, Skeena will again partner with Ausenco Engineering Canada, SRK Consulting and AGP Mining Consultants to complete the PFS.

The target completion date for the PFS is mid-2021.

According to Skeena COO Shane Williams, the PFS is the next step in the evolution of Eskay Creek as the company advances the high-grade, openpit project towards development and to commercial production.

A key work programme as part of the development of the PFS will be an extensive infill drilling programme to convert a large portion of the inferred resources into the measured and indicated category and, following completion of the PFS, declare maiden reserves for Eskay Creek.

Following the completion of the Eskay Creek PEA in 2019, several areas were identified that could be optimised and enhanced with further work. This includes optimising the metallurgy and the concentrate quality, and better optimising the flowsheet, which will further enhance the consistency and value of the final concentrate produced, allowing for key concentrate offtake discussions to begin.

Another focus area will be to gain a better understanding of the geotechnical characteristics in the openpit, which will allow for further pit optimisation studies. Preparations and planning for these work programmes are ongoing.

Key Contracts and Suppliers
Ausenco Engineering Canada, SRK Consulting, and AGP Mining Consultants (PEA and PFS).

Contact Details for Project Information
Skeen Resources, tel +1 604684 8725 or email info@skeenaresources.com.