Meadowbank fells Cumberland

Vancouver-based Cumberland Resources (CLG-T) reports that preproduction capital costs at its Meadowbank gold project in Nunavut will likely exceed $350 million.

Construction costs, in particular, for the proposed 5,500-tonne-per-day operation will be higher than anticipated.

“We are surprised and disappointed by the magnitude of the preliminary capital cost estimates for Meadowbank,” says Cumberland President Kerry Curtis. “Increases in estimated construction consumables and labour requirements have been compounded by dramatic escalations in steel, concrete and fuel costs. These challenging factors will result in a full examination of capital cost alternatives and production throughput variations.”

A delay in completing the feasibility study, combined with seasonal constraints in shipping in the High Arctic region, is expected to push back development by about a year.

Measured and indicated resources stand at 21.7 million tonnes grading 4.3 grams gold per tonne, or nearly 3 million contained ounces of gold. An additional 5.7 million tonnes grading 4.3 grams gold are inferred.

In early 2002, a preliminary assessment by AMEC E&C Services pegged the cost of a 4,700-tonne-per-day operation at Meadowbank at US$123 million.