The Premier gold mine site area in British Columbia
The target date for initial gold production from the past-producing Premier Gold Project (PGP), in British Columbia, has shifted by one quarter to account for the replacement and shipping of certain components and abnormally high snowfall levels, developer Ascot Resources said on Tuesday.
The company explained that a cargo ship travelling from China to Vancouver, carrying the majority of PGP’s clarifier and thickener components, had lost its cargo at sea in a major storm event.
Although insurance would cover the financial cost of replacement, the additional time to fabricate and ship replacement components would cause a delay in the overall project schedule.
This, combined with high snowfall levels associated with storm events on the west coast of British Columbia, resulted in Ascot revising the project development plans throughout the winter season and into 2022. The company announced that it would scale back most outdoor construction activities and delay the start of underground development until snowfall levels subsided.
In Ascot’s currently contemplated underground development sequence, by starting in April 2022 initial ore could potentially be accessed by October, enabling process plant commissioning by the end of 2022. The target date for initial gold production would thus shift from the fourth quarter of 2022 to the first quarter of 2023.
The potential impact on project costs and construction schedule will be assessed.
Meanwhile, British Columbia had issued the PGP a permit for construction and operation and the company said it expected the Environmental Management Act permit to be issued imminently.
The receipt of the final permits is one of the key conditions to draw down the remaining $75-million under the company’s project finance facility.
"Receiving the Mines Act Permit for PGP is a momentous milestone for Ascot, and the culmination of extensive collaboration and consultation with Nisga’a Nation and the provincial regulators. We are grateful that our community-centred approach to responsible mine development and environmental stewardship was a vision shared by all parties involved in the permitting process. We would like to thank our shareholders, Nisga’a Nation and the local towns of Stewart, BC and Hyder, Alaska for their support as we progressed through the permitting process and are looking forward to the next chapter as we advance Canada’s next gold mine towards production,” said president and CEO Derek White.
Based on the 2020 feasibility study mine plan, without factoring in additional mine life extension potential through further resource growth and conversion to reserves, the project is expected to bring much prosperity to the local communities. During the 12-month construction phase, Ascot expects the project to employ a peak of about 140 people, and in operation the mine will directly employ 280 people, excluding subcontractors, suppliers and ancillary services.
Over the initial eight-year mine life, Ascot expects to invest C$353-million in initial and sustaining capital and incur C$884-million in operating expenses, the vast majority of which would be spent locally and in the province.
The mine would generate about C$403-million in provincial and federal taxes and C$746-million in after-tax free cash flow based on current spot metal prices.
Ascot said that PGP would be one of British Columbia’s lowest carbon-intensive gold mines, across all three scopes of greenhouse gas measurements.