Crews have been mobilized to the Meadowbank gold project, 70 km north of Baker Lake in Nunavut, as
The $1.3-million program is designed to expand the resource of the new Vault deposit, as well as define the higher-grade components of the deposit. Vault was discovered last year, 5 km northeast of the four near-surface gold deposits at Meadowbank, namely Third Portage, Goose Island, Bay Zone and North Portage. Internal resource calculations, based on 26 widely spaced drill holes, indicate that Vault hosts an inferred resource of 3.3 million tonnes grading 3.9 grams gold per tonne, equivalent to 422,000 oz.
“The Vault deposit has the location, open-pit potential and possibly an untapped high-grade aspect beneficial for the advancement of this project,” says Kerry Curtis, senior vice-president. “We are optimistic that resources will grow quickly and substantially at the Vault.”
Mineralization has been intersected within 120 metres of surface over an area measuring 850 by 300 metres. The deposit remains open along strike and downdip. Higher-grade intersections from the northeastern limits of drilling include 8.75 metres grading 7.02 grams, starting at a vertical depth of 90 metres, in hole 24, and 3.9 metres of 7.93 grams, beginning at 110 metres of depth, in hole 26.
Shallow, moderate-grade intersections offering potential for expansion include 17 metres of 4.02 grams, starting at 55 metres of depth, in hole 18, and 6.35 metres of 6.12 grams, at 34 metres below surface, in hole 15.
The addition of the Vault deposit brings the total resource base for the Meadowbank project to 2.5 million contained ounces.
In March 2000, prior to the discovery of Vault, MRDI Canada completed a prefeasibility study, including an independent resource evaluation. The study investigated the economics of combined open-pit and underground production with winter road access and a rotational staff (to be flown in and out every three weeks).
MRDI identified a resource of 11.24 million tonnes averaging a grade of 5.73 grams, equal to 2.1 million oz. Proven and probable open-pit reserves are estimated at 5.5 million tonnes grading 5.44 grams, or 963,000 contained ounces, using a gold price of US$300-325 per oz. The projected stripping ratio is 7.5-to-1, and the mill recovery rate is pegged at 92.4%.
The study envisions a 2,500-tonne-per-day operation producing an average of 160,000 oz. annually over eight years. Open-pit reserves are sufficient for six of the eight years of projected production. Total cash costs would be as low as US$145 per oz. in the first year of operation and average US$196 per oz. over the life of the project. Capital costs are expected to total US$93 million.
Two ensure a minimum mine life of 10 years, one of two things is required: an improved gold price, or the discovery of additional open-pit resources. The study concludes that shallow, open-pit prospects require average grades of better than 2.5 grams per tonne.
Toward that end, last year’s exploration activities focused on expanding the resource base of the project, and the program was successful insofar as it led to the discovery of the Vault deposit. Cumberland believes the deposit could contribute additional open-pit resources, while enhancing the economics of the project without adding significant capital costs.
This year’s program may include the drill-testing of other targets, such as the PDF occurrence, 10 km north of the Meadowbank deposits. During the 2000 program, six widely spaced holes intercepted up to 7.5 grams over 2.5 metres within 30 metres of surface.
Cumberland is well-financed, with $5.6 million in cash. The junior has 27.5 million shares outstanding.
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