Northgate emerges with 50% stake in Neptune gold bet

With open-pit reserves standing at 29 million tons of grade 0.056 oz gold perton, the mine is expected to produce 200,000 oz per year when it is running at f ull speed.

Having put $55 million into Neptune’s treasury, Northgate now holds a 50% stake in Colomac as well as 54% of the Vancouver company’s outstanding shares. Neptu ne holds the remaining 50% interest at Colomac.

Proceeds of the transaction are earmarked for a construction program that is expected to cost around $190 million when it is completed, says Neptune spokesman Douglas Belanger.

Total costs include $20 million on exploration, $155 million in construction capital and $15 million in working capital.

Construction crews are currently about 2 1/2 weeks ahead of schedule and the 12,000-ton-per-day mill and crusher have already been installed.

“From the outside it looks like all the work has been done but there is still a lot of wiring to do,” Belanger told The Northern Miner. To avoid any delays du e to breakdowns, a lot of extra equipment has been brought in recently and more will be installed this winter when the lakes between the mine site and Yellowkni fe freeze over.

“It is pretty hard to fly in a 7-ton truck,” chuckled Belanger, who reckons that project managers are in pretty good shape as they are going into t he winter.

All companies involved are expected to reschedule the Colomac cost structure once they have proven that the mine works. Initial production costs are expected to be $275(C) per oz. Mining will cost $6.79 per ton; milling, $7.17 per ton; an d general and administrative charges, $2.29.

Also, mill recovery rates have been estimated at 93% to 95%, according to figures released by Neptune.

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