Pretium works to conquer the Valley of the Kings

VANCOUVER — In a drive to complete a feasibility study on its wholly-owned Brucejack gold-silver project 65 kilometers north of Stewart, B.C., Vancouver-based Pretium Resources (PVG-T, PVG-N) released an updated resource estimate on its Valley of the Kings zone on Nov. 20.

Noted for its bonanza gold intercepts, the Valley of the Kings was the site of a 99,600-metre, 270-hole drill program during 2012. Due to recent geological interpretation Pretium was also able to incorporate 6,300 metres of drilling at its Galena Hill zone — which is now viewed as an extension of the Valley of the Kings — into a single resource estimate. Data at the Valley of Kings now covers 490 drillholes over 174,182 meters.

As a result of its 2012 program Pretium increased indicated resources at the Valley of the Kings by 66% to 16.1 million tonnes grading 16.4 grams gold per tonne for 8.5 million contained oz.

Drilling collared at the eastern and western boundaries of the deposit marginally bumped inferred resources to 5.4 million tonnes averaging 17 grams gold for 2.9 million oz., though the company was more focused on boosting indicated tonnage in anticipation of its upcoming feasibility study.

Silver resources now sit at 7.3 million indicated oz. at an average grade of 14.2 grams. All modelling assumes a cut-off grade of 5 grams gold equivalent per tonne.

Pretium reports that indicated resources at the Valley of the Kings are now defined over roughly 600 metres of total strike length, and extend to depths in excess of 1,000 metres. A portion of the deposits strike length was not incorporated into the updated resource estimate, and mineralization remains open to the east and west — along strike and at depth.

Pretium’s Brucejack property now hosts five defined gold-silver zones, including: the West Zone, Valley of the Kings, Bridge Zone, Gossan Hill, and Shore zone. The current resource lies predominantly in the Valley of the Kings and West zone, with 2012 drilling aimed at delineating the Valley of the Kings and Galena Hill extension.

Pretium initiated an underground exploration program in the third quarter designed to access the Valley of the Kings and establish continuity in the deposits higher-grade mineralization.

Currently in its first phase, the program will involve slashing out existing West zone underground workings to drive a 450-metre southern decline to the Valley of the Kings. The company intends to bulk sample roughly 10,000 tonnes of material from the deposit in the first half of 2013.

A feasibility study is scheduled to be released within roughly eight months. Pretium is modelling an underground mine with a throughput capacity of 2,700 tonnes per day, assuming long-hole stoping and cemented-paste backfill. Stoping will incorporate a combination of longitudinal and transverse mining depending on zone width and orientation.

Pretium reported a working capital position totalling roughly $60 million to end the third quarter after the company issued 1.15 million flow-through shares during a private placement at a price of $18 per share for gross proceeds of $20.7 million.

The resource announcement resulted in a modest market jump, as Pretium’s shares closed Nov. 20 up 1.4% or 18¢ at $12.95. The company hit a daily high of $13.25 per share during mid-day trading. Pretium has 94 million shares outstanding and maintains a $1.23 billion press-time market capitalization.