Vancouver – The Pogo joint venture was given the green light for development of its Pogo gold project in the Fairbanks district of Alaska. Construction had been halted by Teck Cominco (TEK-T) the operator, in May when one of the discharge permits that had been issued came into question. Meanwhile projected capital costs for the project have risen by 12% – from US$250 million estimated in late 2002 at the time of the interim feasibility study, to the current US$280 million.
Teck and partner Sumitomo Metal Mining have received approval for the final feasibility study and production program for their underground gold mine. Teck is earning a 40% interest in the property, with the remainder held by Sumitomo.
The Pogo project is being developed as an underground 2,500 ton per day operation which will produce 350,000 to 500,000 ounces gold per year over a ten-year mine-life. Teck budgeted US$75 million for development spending in 2004, most of which was earmarked for Pogo.
Reserves at Pogo are pegged at 7.7 million ton grading 0.48 oz. gold per ton. Resources include 800,000 tons at 0.26 oz. gold in the indicated and 1.4 million tons grading 0.49 oz. gold in the inferred category. The companies believe there is good potential to increase their reserves through continued exploration.
With all major permits in hand and the administrative appeal for the key water discharge permit withdrawn, construction is underway again.
A 49-mile road being built from the mine site to the Richardson highway is expected to be completed this September. Commercial production is now expected by August 2006.
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