Vancouver — The jump in the price of bullion has breathed new life into the Ivanhoe property in Nevada’s Carlin trend.
“The economic assessment of the Ivanhoe project is extremely encouraging,” says Great Basin President Ronald Thiessen. “It clearly indicates the undervalued nature of the project and the importance of continuing to advance it towards production.”
Based prices of US$300 per oz. gold and US$4.40 per oz. silver, the value of the project is now estimated at $203 million. Using a discount rate of 6%, the value drops to $161 million.
Using an inferred mineral resource of 719,000 tons grading 1.29 oz. gold and 7 oz. silver per ton, the company envisions underground production of 600 tons per day over a mine life of five years, with ore sent to a local mill. Accordingly, annual production would be 179,000 oz. gold and 920,000 oz. silver.
Cash costs are pegged at US$114 per oz. gold-equivalent, with total costs slated at US$134 per oz. gold-equivalent. The economic model uses 50% mining dilution and carbon-in-leach processing with recoveries of 95% for gold and 90% for silver. Underground mining costs are estimated at US$55.50 per ton, with toll-milling charges in the range of US$25 per ton. Capital costs would likely be about US$22 million.
Lying in the prolific Carlin trend, midway between
Although multiple styles of mineralization exist on the property, the resource is hosted in high-grade, narrow structures in the Ordovician Valmy formation, unconformably below Tertiary volcanic rocks. The roots and feeders to the overlying disseminated gold mineralization form a series of high-grade, quartz-adularia-illite veins, vein breccias and fractures hosted in quartzites, and fine-grained clastic sedimentary rocks. The veins are covered by 250-500 ft. of Tertiary volcanics and lie under two unconformable surfaces. Great Basin reports that the veins exhibit gold grades, widths, mineralogy and age similar to those found at Ken Snyder, which hosts 2.7 million tons grading 1.12 oz. gold and 12.82 oz. silver.
These vein systems, defined by numerous parallel veins and splays, generally trend in an east-westerly direction and dip toward the south. Two of the most primary east-west vein systems, Clementine and Gwenivere, have been confirmed over strike lengths of 1,500 ft. and 1,100 ft., respectively. Gold and silver mineralization along these trends extends to a vertical depth of 1,000 ft., and both vein systems remain open at depth and along strike. Three additional parallel vein structures exist north and south of the Clementine and Gwenivere trends.
Kappes Cassiday Associates of Reno, Nev., completed the metallurgical study of material from the Hollister feeder veins. A series of standard, 96-hour, direct-cyanidation bottle-roll tests were conducted on material ground to various sizes. Recoveries were as follows:
q up to 95% gold and 90% silver in 48 hours for quartzite hosted-veins;
q 96% gold and 94% silver in 24 hours for argillite hosted veins; and
q 97% gold and 92% silver in 48 hours for the clay-dominant mineralization.
With no debt, $10 million in working capital and 41 million shares outstanding, Great Basin has elected to secure additional funding. The company inked a financing agreement with Loewen, Ondaatje, McCutcheon to raise up to $7.5 million by way of a private placement. The placement consists of 5 million units priced at $1.50 each. A unit consists of one share and one warrant, which is exercisable for one year. The shares are subject to a hold period of four months.
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