London-listed Hochschild Mining has excised its option to start earning in to a 60% interest in the Snip gold project, in the Golden Triangle of British Columbia, Canada.
Held by Skeena Resources, Snip consists of one mining lease and eight mineral claims totalling 4 546 ha in the Tahltan Territory. Skeena acquired Snip from Barrick Gold in 2017.
The former Snip mine produced about one-million ounces of gold from 1991 until 1999 at an average gold grade of 27.5 g/t. Since then, the project has been improved with the recent construction of nearby infrastructure and substantially higher gold prices.
"We are pleased to exercise our option on the Snip project in Tahltan Territory, Canada. This represents a first step in our strategy to add another high-grade project with strong upside potential into our pipeline,” said Hochschild CEO Ignacio Bustamante.
Underground drilling restarted in late 2017 to explore for additional mineralised shoots in a large shear structure. A maiden mineral resource was announced in July 2020, including 244 000 oz of gold in the indicated category at an average grade of 14.0 g/t and 402 000 oz of gold in the inferred category at an average grade of 13.3 g/t.
Subsequent drill campaigns, totalling about 32 000 m, upgraded areas of existing inferred resources from the mineral resource estimate to the measured and indicated categories, expanded the resource, and delineated additional mineralisation in previously unexplored areas of the near-mine environment.
Going forward, Hochschild said it planned to continue these drill campaigns and to initiate selected studies and testwork.
In September 2018, Skeena granted Hochschild an option to earn-in to a 60% interest in Snip over three years by spending twice the amount Skeena had spent since it originally optioned the property from Barrick in March 2016. To date, Skeena estimates that it has incurred about C$50-million of expenditure on the project.
To exercise the option, Hochschild must incur no less than C$7.5-million in exploration or development expenditures on Snip in each year of the option period. On complying with the above, Hochschild must provide 60% of the financial assurance required by governmental authorities for the Snip mining properties.