Nettoyeur haute pression thermique AgriEuro Top-Line EWD-K 15/310- Moteur Honda GX 390Pays de fabrication Italie, Typologie À chariot, Activation moteur thermique, Sur roues, modèle de moteur GX390, Type de moteur 4 temps, Cylindrée 389cm³, Puissance nominale 13HP, Système de décompression automatique, Marque du moteur Honda , Matériau culasse Laiton, Type pompe à 3 pistons en ligne, Variateur de pression, Débit horaire max 900L/h, Pression max 310bars, Pompe linéaire Pro, Chariot (roues et poignées) , Poids 50Kg
Nettoyeur haute pression thermique AgriEuro Top-Line EWD-K 15/310 - Moteur Loncin G390FPays de fabrication Italie, Typologie À chariot, Activation moteur thermique, Sur roues, modèle de moteur G390F, Type de moteur 4 temps, Cylindrée 389cm³, Puissance nominale 13HP, Système de décompression automatique, Marque du moteur Loncin, Matériau culasse Laiton, Type pompe à 3 pistons en ligne, Variateur de pression, Débit horaire max 900L/h, Pression max 310bars, Pompe linéaire Pro, Poids 50Kg
VALEO Kit d'embrayage + Volant moteur pour VOLKSWAGEN: Golf, Touran, Transporter, Passat, Caddy, Jetta & AUDI: A3 & SEAT: Leon, Altea (Ref: 835035)VALEO Kit d'embrayage + Volant moteur pour VOLKSWAGEN: Golf (V,V Plus,VI Plus,V SW,V SW 4-Motion), Touran (I,I Phase 2), Transporter (T5 7H,T5 7J), Passat (B6 Berline,B6 SW), Caddy (III,III Maxi), Jetta (III 1K2,III Phase 2 1K2) & AUDI: A3 (Série 2 8P1,Série 2 Sportback,Série 2 Phase 2 Sportback,Série 2 Phase 2,Série 2 Cabriolet 8P) & SEAT: Leon (II 1P1,II 1P1 Phase 2), Altea ( XL, XL Phase 2,Phase 2,Phase 3), Toledo (série 3) & SKODA: Octavia (1Z3 Berline,1Z3 Berline Phase 2,1Z5 Combi Phase 2,1Z5 Combi), Superb (II,II Combi) (Ref : 835035) équivalente à AUDI: 03G105264C, 03G105264D, 03G105264G, 03G105266AC, 03G105266BA, 03G105266BM, 03L105266BS, 03L105266E, 3G105264C, 3G105264D, 3G105264G, 3G105266AC, 3G105266BA, 3G105266BM, 3L105266BS, 3L105266E & SEAT: 03G105264G, 03G105266AC, 03G105266BA, 03G105266BM, 03L105266BS, 03L105266E, 3G105264G, 3G105266AC, 3G105266BA, 3G105266BM, 3L105266BS, 3L105266E & SKODA: 03G105264G, 03G105266AC, 03G105266BA, 03G105266BM, 03L105266BS, 03L105266E, 3G105264G, 3G105266AC, 3G105266BA, 3G105266BM, 3L105266BS, 3L105266E & VW: 03G105264G, 03G105266AC, 03G105266AL, 03G105266BA, 03G105266BM, 03G105266E, 03L105266BS, 03L105266E, 3G105264G, 3G105266AC, 3G105266AL, 3G105266BA, 3G105266BM, 3G105266E, 3L105266BS, 3L105266E Avec butée d'embrayage : Oui, Type de volant moteur : Volant moteur rigide, gamme équipementier : KIT4P - CONVERSION KIT, Composition : Volant moteur, disque, mécanisme et butée mécanique, fonctionnement du volant moteur : Conversion, type de fonctionnement : poussé, Poids : 15.6 kg, Angle de serrage [degré] : 90.0 °, Couple de serrage : 60.0 Nm, marque : VALEO, avec consigne : non, disque d'embrayage : oui, mécanisme d'embrayage : oui, but du produit : Le volant moteur à deux masses, dit bi-masse et l'embrayage transmettent la force de rotation du vilebrequin du moteur à l'arbre primaire de la boîte de vitesse, avec mécanisme de désaccouplement et réaccouplement progressif qui permet le passage des vitesses. Une partie du volant moteur est boulonné au vilebrequin qui l'entraine, la seconde partie qui supporte le kit d'embrayage, permet d'amortir les chocs, changement de régime et acyclismes du régime moteur transmis à la boite de vitesses par un système à ressort sophistiqué. Pour une protection de la mécanique mais aussi pour un confort de conduite, le kit d'embrayage constitué d'un disque, un mécanisme et d'une butée permet d'entrainer la boîte par l'arbre primaire relier au disque, la butée qui actionne le mécanisme libère le disque de l'entrainement du moteur à chaque appuis sur la pédale d'embrayage pour un changement de rapport. Un kit d'embrayage + volant moteur vous permet de refaire entièrement l'embrayage de votre voiture. Il est généralement livré avec un jeu de boulons et le lubrifiant nécessaire., quand changer : Selon les modèles, votre style de conduite et la nature de vos parcours habituels, un embrayage dure aux alentours de 150000 km. Le symptôme classique d'usure est la...
Pompe Piscine Max Flo Hayward - 1.5cv 15m³/h TriLa pompe Max Flo d'Hayward est performante, silencieuse et peu gourmande en énergie. Elle s'adapte aux piscines de petites et moyenne tailles. Plébiscitée par un grand nombre d'utilisateurs, elle est une référence dans sa catégorie. La Max Flo est une pompe hayward auto amorçante et s'adapte à l'eau salée pour une compatibilité avec les électrolyseurs.
Pompe piscine STA RITE PENTAIR de 16 m3/h (1CV ) - TriphaséPompe piscine STA - RITE modèle P-STR La pompe piscine STA - RITE est la pompe la plus haut de gamme, résistante à toutes épreuves, des rendement surpuissant, un moteur ultra silencieux. Le moteur bénéfice de la technologie PENTAIR éprouvé et efficace renforcé en fibre de verre, une turbine haute pression pour un débit maximale COMPATIBLE ELECTROLYSEUR - Pompe STA RITE 5P2R de 3/4 à 1.5 CV en mono La pompe STA - RITE de la série 5P2R est en matériau de synthèse renforcé à la fibre de verre et obtenue par moulage de haute précision. Moteur Moteur européen conforme aux normes “CE” et muni d’une protection IP 55. La conception spéciale du diffuseur assure un auto-amorçage très efficace. Embase La pompe STA RITE 5P2R est montée sur une embase surélevée, stable, rigide et antivibrations. La hauteur de l’embase préserve le moteur de l’humidité et des souillures. Collier d’assemblage Le collier d’assemblage, en acier inoxydable, permet un démontage rapide de l’ensemble et un accès aisé aux pièces mobiles. Obtenue par le moulage sous pression, la turbine est conçue pour délivrer une hauteur manométrique élevée. Sa finition et son équilibrage dynamique lui assurent un fonctionnement silencieux et un excellent rendement. Le couvercle transparent du préfiltre permet facilement de vérifier l’état de colmatage du panier. Le couvercle a un ø de 127 mm et résiste à une pression de 4 bar. le panier du préfiltre est verrouillable et protège la turbine des impuretés. Construction Le matériau utilisé pour la fabrication de la pompe sta rite et du préfiltre autorise une pression de service élevée. Testé pendant plusieurs années ce matériau a des caractéristiques incomparables et résiste même à des variations de températures importantes. Presse-étoupe Comme sur des millions de pompes STA-RITE une étanchéité parfaite est obtenue par le presse-étoupe en céramique de carbone finement polie et surfacée. Données Techniques La pompes de la série 5P2R est une pompe centrifuge qui est principalement conçue pour l’application dans la piscine, en combinaison avec un filtre de piscine.- Pompe piscine STA RITE PENTAIR de 16 m3/h (1CV ) - TriphaséPompe piscine STA - RITE modèle P-STR La pompe piscine STA - RITE est la pompe la plus haut de gamme, résistante à toutes épreuves, des rendement surpuissant, un moteur ultra silencieux. Le moteur bénéfice de la technologie PENTAIR éprouvé et efficace renforcé en fibre de verre, une turbine haute p
Pompe vide piscine - IntexLa pompe vide piscine Intex est le produit idéal pour vider votre piscine en toute simplicité. Facile à utiliser, il suffit de brancher l'appareil sur le secteur et de le positionner au fond de votre bassin. La pompe se chargera de vider l'eau restante en un temps record (pompe jusqu'à 3595 litres d'eau/heure) là où vous le souhaitez. La pompe dispose d'une protection IPX8, ce boitier étanche et compact peut se connecter à un tuyau de 5 mètres ou à un tuyau d'arrosage à l'aide d'un adaptateur compris dans le kit. La pompe vide piscine Intex fonctionne avec une hauteur d'eau de 1m22 maximum. Au-delà de cette limite, l'appareil se mettra en sécurité.
Gré Pompe piscine Gre Premium Modèle - 1,00 CV - 12 m3/hPompe de filtration Gre Premium Pompe auto-amorçante avec préfiltre pour piscine La pompe piscine Premium Gre est l’élément le plus déterminant pour la qualité d’eau de votre piscine. Chargée d’acheminer l’eau depuis la buse d’aspiration/skimmer puis au travers du filtre et enfin jusqu’à la buse de refoulement de votre piscine. Avec une puissance d’aspiration constante, la pompe auto-amorçante Premium se destine aux piscines aux piscines hors-sol ainsi qu’aux piscines enterrées ayant un diamètre de tuyau de 38 ou 50mm. Avec son panier préfiltre intégré, cette pompe de piscine va capture les plus gros débris afin qu’ils n’endommagent pas l’hélice ou le moteur et n’encrassent pas prématurément votre filtre à sable. Facile d’ accès par le dessus de la pompe, vous pourrez contrôler son encrassement d’un simple coup d’oeil car il est protégé par un couvercle transparent. Aussi, vous verrez immédiatement quand il est nécessaire de le vider. Caractéristiques détaillées Modèle Gre Premium PP102 Gre Premium PP152 Gre Premium PP202 Puissance 1,00 CV / 900 W 1,50 CV / 1100 W 2,00 CV / 1600 W Débit min 12 m³/h 17 m³/h 21 m3/h Débit max 20 m3/h 22 m3/h 27 m3/h Volume de piscine maximal recommandé 100 m³ 135 m³ 170 m³ Raccordement hydraulique tuyaux de 38 ou 50 mm Diamètre de filtre à sable recommandé 600 mm 700 mm 800 mm Poids 6,00 kg 7,50 kg 10,70 kg Dimensions pompe 55,3 x 22 x 27,8 cm Garantie légale de conformité et des vices cachés : 2 ans
Gré Pompe piscine Gre vitesse variable VSG75Pompe piscine Gre VSG 75 à vitesse variable 0,75CV monophasée Économique, silencieuse et performante. La pompe à vitesse variable est l’avenir de la filtration car elle répond à la fois aux exigences de performances et d’économies d’énergie. Avec le modèle VSG75, Gre met propose une pompe idéale pour tout type de piscine jusqu’à 65m³ qui permettra de garder une eau claire tout en maximisant les économies réalisées. Une circulation lente de l’eau améliore la qualité de la filtration. La pompe à vitesse variable assure une filtration constante à faible vitesse mais permet aussi un excellent nettoyage de votre filtre à sable lorsqu’elle est paramétrée en vitesse maximale. Avec ses quatre réglages de vitesse, la pompe VSG75 mono Gre permet un mélange plus homogène des produits dans votre piscine. En mode automatique, cette pompe de filtration vous permet de paramétrer différentes vitesses de fonctionnement en fonction de plages horaires pour que la pompe s’adapte réellement à vos besoins et selon vos habitudes de baignade. Le paramétrage est simplifié par une interface à 4 boutons intuitifs ainsi qu’une notice détaillée qui accompagnera le matériel. Caractéristiques techniques Moteur Vitesse variable Volume de piscine toute piscine jusqu’à 65 m³ Alimentation Monophasée 220-240 V, branchement sur prise secteur Débit maximal 19.54 m3/h Puissance d’entrée 750 W Vitesses de fonctionnement LOW : 1150 rpm MEDI : 1700 rpm HIGH : 2100 rpm FULL : 2850 rpm Diamètre du raccordement hydraulique propre 50 mm Température maximum en °C 35 Kit raccord union O/N Fourni, à coller pivotant Émissions sonores 53 à 59 dB Dimensions 55,3 x 22 x h.27,8cm Poids 9 kg Garantie légale de conformité et des vices cachés : 2 ans
JetlineSelection FI 21kw 110m3 pompe à chaleur piscine PoolexJetlineSelection FI 21kw 110m3 pompe à chaleur piscine Poolex
Bestway Pompe à chaleur HS35 pour piscine hors-sol<!-- <p class=indisponible><span class=message-indispo>Cet article est obsolète.</span><br /> > Consulter le rayon <a href=https://www.mypiscine.com/669-pompe-a-chaleur-piscine-hors-sol title=PAC piscine hors sol>Pompe à chaleur pour piscine hors-sol</a></p> --> <p>Pompe à chaleur Bestway HS35 pour piscine hors sol - 20m3/h</p> <ul> <li>A brancher sur une prise Plug & Play directement sur le secteur</li> <li>Pour piscine hors-sol jusqu'à 20m3</li> <li>Puissance : 3,5 KW</li> <li>Fonctionne dès 10°C</li> <li>Longueur tuyaux : 2 m</li> <li>Connexion : Ø 32 mm</li> <li>Débit pompe : 2 m3/h</li> <li>Dimensions : 37 x 29 x H 31 cm</li> <li>Panneau de contrôle intuitif avec 3 boutons</li> </ul>
EXIT TOYS EXIT Piscine tubulaire Stone pompe filtre à sable 5,4x2,5x1,22 m, grisLa piscine Stone d'EXIT aux dimensions 540 x 250 x 122 cm est de forme rectangulaire grise. La grande piscine est fournie en série avec une pompe à filtre à sable et une échelle pour monter et sortir du bassin en sécurité. Le diamètre large de la piscine offre suffisamment d'espace pour se...
Piscine tubulaire amovible Bestway Power Steel avec pompe à filtre 488x244x122 cmPiscine portable : Entièrement renforcée, elle possède une structure de tubes en aluminium galvanisé. Montage facile, avec un temps estimé à 60 minutes (voir vidéo), et démontage simple. Échelle de 122 cm, avec plateforme pour une plus grande stabilité. Couverture superficielle. Tapisserie de sol. Robinet de vidange avec raccord de tuyau. DVD d'exploitation et d'entretien. Cette piscine hors sol amovible se démarque par sa simplicité de montage et de démontage et son entretien facile. De forme rectangulaire et de couleur gris clair, cette piscine hors sol renforcée est très résistante à une éventuelle corrosion grâce à sa structure tubulaire en aluminium galvanisé et ses parois latérales renforcées de PVC haute densité. La doublure est composée de trois couches, dont deux en PVC haute densité et une couche centrale en polyester. Fabriqué par soudure haute fréquence, le liner reçoit également un traitement ultraviolet pour protéger sa couleur. Pour faciliter le drainage et la vidange, la piscine est équipée d'un robinet de vidange et d'un adaptateur de tuyau d'arrosage standard. Il comprend également une échelle d'accès à la piscine de 122 cm avec une plateforme intégrée pour une plus grande stabilité. Ce modèle de piscine comprend également une couverture de surface, un tapis de sol et un DVD expliquant le fonctionnement et l'entretien. Le temps estimé pour le montage de chaque piscine est une évaluation faite dans des conditions normales, une fois la dalle préparée pour commencer l'installation.
BESTWAY Fast Set Piscine hors sol motif rotin gris, 396 x 84 cm, avec pompe 57376Facile et rapide a monter, le kit piscine Fast Set™ de Bestway® vous permettra de vous prélasser au bord de votre nouvelle piscine en un rien de temps. Cette piscine est idéale pour amuser vos enfants et leur faire découvrir le plaisir d’une baignade et les joies de la piscine en toute sécurité. Les enfants vont adorer passer leurs journées d’été a s’éclabousser et a jouer dans l’eau, et les parents pourront également profiter d’une baignade agréable et relaxante. La pompe de filtration inclue avec la piscine vous aidera a garder une eau propre. Avec son liner effet rotin, elle apportera une petite touche de décoration a votre jardin. L’été n’est pas vraiment l’été sans la piscine Fast Set™ de Bestway® ! Caractéristiques: Dimensions: 396 x 84 cm Volume d'eau a 80%: 7 340 L Débit de la pompe: 2 006 L Compatibilité des cartouches: Cartouche 58094 (II) Matériau: Duraplus™ Temps de montage: 10 minutes Contenu: 1 piscine 1 pompe de filtration 1 cartouche de filtration Technologies: Avec son procédé d’installation ultrasimple Fill & Rise™, pas de prise de tete ! Il vous suffit de choisir une surface plane, de gonfler l’anneau supérieur et la piscine se levera au fur et a mesure qu’elle se remplira d'eau. Le liner est fabriqué en DuraPlus™, un matériau extremement résistant fait de 3 épaisseurs renforcées, 85 % plus résistant a la perforation que le PVC. Il est réputé pour sa résistance a la perforation, sa durabilité et sa longévité. Photo d'illustration>
Pompe à chaleur Poolex Nano Action-3 kW / 10 à 21m3POOLEX NANO ACTION LA PAC POUR LES PETITS BASSINS Nous vous recommandons cette pompe à chaleur Poolex Nano Action ; en effet cette PAC pour petits bassins à tout d'une grande ! Elle est, en outre, compatible avec les piscines hors sol. DESCRIPTION DE LA PAC NANO POOLEX ACTION La PAC fabriquée spécialement pour les petits bassins. Elle convient pour différents types de bassins : les piscines avec structure tubulaire, les piscines hors sols ou encore les piscines enterrées. Bien qu'elle soit plus petit, elle dispose d' un COP similaire aux pompes à chaleur haut de gamme, la NANO arrive à talonner ses grands frères Jetline et Silverline. Dotée d'une prise électrique classique, chauffez votre piscine en quelques heures et sans effort ! Son design unique et très compact fait l'une des meilleures mini PAC du marché . Offrez-vous la performance d'une Poolex au meilleur prix. AVANTAGES POOLEX NANO ACTION R32 : Dimensions compactes Raccords sur filtration standard Transportable (15kg) Economique et silencieuse (moins de 33dB à 10 mètres) Système électrique sécurisé Système Plug & Play Fonctionne à partir de 8°C 100% sécurisée Pompe à chaleur garantie 2 ans Pourquoi choisir NANO ACTION ? Plug & play Fonctionne à partir de 8°C Compatible toutes piscines hors sol Légère et compacte Ultra silencieuse Économique Accessoires inclus avec la Poolex Nano Action Votre pompe à chaleur POOLEX NANO ACTION, vous est livrée : dans un emballage à structure renforcée avec un manuel d'installation et d'utilisation multi-langues avec une prise électrique d'une longueur de 5 mètres avec protection différentielle de 10mA avec des connecteurs PVC de diamètre 32-38mm Principes et avantages de la pompe à chaleur piscine Bien que son acquisition s'avère relativement onéreuse, la pompe à chaleur POOLEX NANO ACTION consomme très peu d'énergie lorsqu'elle fonctionne. En effet, elle restitue jusqu'à cinq fois plus d'énergie qu'elle n'en consomme puisque l'énergie principalement utilisée pour générer de la chaleur est issue de l'air extérieur, une source d'énergie renouvelable. Le coût initial de la pompe à chaleur est donc rapidement amorti grâce aux économies énergétiques qu'elle permet . À titre d'exemple, pour 600W d'énergie consommée, elle restitue 3000W de chauffage. Caractéristiques de la pompe à chaleur Poolex NANO Action POINT FORT : Avec un prix imbattable et une performance inégalée pour ce petit gabarit, la POOLEX NANO est la PAC que tout le monde peut acquérir et installer très facilement ! Lancez vous sans hésiter ! Découvrez également la POOLEX NANO ACTION RÉVERSIBLE Pompe à chaleur POOLEX NANO Action Réversible R32 - Pour petit bassin jusqu'à 35m3 - COP de 5,3 - S'installe facilement - Meilleur rapport Qualité/Prix - Ultra légère : 15Kg - Economique et ultra Silencieuse - Nouveau fluide réfrigérant écologique R32 POOLEX NANO ACTION RÉVERSIBLE : LA PAC POUR LES PETITS BASSINS ET SPAS eROBOT-PISCINE.fr vous propose la pompe à chaleur de piscine Poolex NANO ACTION...
Kit By Pass Deluxe pour pompe à chaleur - UbbinkPour installer votre pompe à chaleur pour la piscine, il est indispensable de créer un << by-pass >> sur votre installation. Il s'agit d'une dérivation sur votre canalisation de filtration. Le Kit By Pass est compatible avec tuyauterie diamètres 50 et 38 mm : 2 coudes 90° à coller, 2 té 90° à coller, 3 vannes, 2 raccords cannelés 50 x 38 à coller, 1 colle 125 ml, 1 décapant 500 ml.
Piscine gonflable Intex Easy Set 28122NP + Pompe filtrePays de fabrication Chine, Forme Ronde, Hauteur piscine 76cm, Capacité piscine 3853L, Largeur piscine 305cm, Hauteur max de l'eau 53cm, N°de personnes Max 3-4, Débit horaire max 1250L/h, Filtre À cartouche
Piscine Intex Rectangular Frame 28274NP + Pompe filtrePays de fabrication Chine, Forme Rectangulaire, Longueur piscine 450cm, Largeur piscine 220cm, Hauteur piscine 84cm, Hauteur max de l'eau 72cm, Capacité piscine 7127L, N°de personnes Max 5-6, Débit horaire max 2006L/h, Filtre À cartouche- Pompe Piscine Max Flo Hayward - 1cv 13m³ TriLa pompe Max Flo d'Hayward est performante, silencieuse et peu gourmande en énergie. Elle s'adapte aux piscines de petites et moyenne tailles. Plébiscitée par un grand nombre d'utilisateurs, elle est une référence dans sa catégorie. La Max Flo est une pompe hayward auto amorçante et s'adapte à l'eau salée pour une compatibilité avec les électrolyseurs.
- Pompe Piscine Max Flo Hayward - 1.5cv 15m³/h MonoLa pompe Max Flo d'Hayward est performante, silencieuse et peu gourmande en énergie. Elle s'adapte aux piscines de petites et moyenne tailles. Plébiscitée par un grand nombre d'utilisateurs, elle est une référence dans sa catégorie. La Max Flo est une pompe hayward auto amorçante et s'adapte à l'eau salée pour une compatibilité avec les électrolyseurs.
- Pompe Piscine Max Flo Hayward - 0.75cv 11m³/h TriLa pompe Max Flo d'Hayward est performante, silencieuse et peu gourmande en énergie. Elle s'adapte aux piscines de petites et moyenne tailles. Plébiscitée par un grand nombre d'utilisateurs, elle est une référence dans sa catégorie. La Max Flo est une pompe hayward auto amorçante et s'adapte à l'eau salée pour une compatibilité avec les électrolyseurs.
- Pompe Piscine Max Flo Hayward - 1cv 13m³/h MonoLa pompe Max Flo d'Hayward est performante, silencieuse et peu gourmande en énergie. Elle s'adapte aux piscines de petites et moyenne tailles. Plébiscitée par un grand nombre d'utilisateurs, elle est une référence dans sa catégorie. La Max Flo est une pompe hayward auto amorçante et s'adapte à l'eau salée pour une compatibilité avec les électrolyseurs.
- Pompe Piscine Max Flo Hayward - 0.75cv 11m³/h MonoLa pompe Max Flo d'Hayward est performante, silencieuse et peu gourmande en énergie. Elle s'adapte aux piscines de petites et moyenne tailles. Plébiscitée par un grand nombre d'utilisateurs, elle est une référence dans sa catégorie. La Max Flo est une pompe hayward auto amorçante et s'adapte à l'eau salée pour une compatibilité avec les électrolyseurs.
- Pompe Piscine Max Flo Hayward - 0.5cv 8m³/h MonoLa pompe Max Flo d'Hayward est performante, silencieuse et peu gourmande en énergie. Elle s'adapte aux piscines de petites et moyenne tailles. Plébiscitée par un grand nombre d'utilisateurs, elle est une référence dans sa catégorie. La Max Flo est une pompe hayward auto amorçante et s'adapte à l'eau salée pour une compatibilité avec les électrolyseurs.
- Pompe Piscine Max Flo HaywardLa pompe Max Flo d'Hayward est performante, silencieuse et peu gourmande en énergie. Elle s'adapte aux piscines de petites et moyenne tailles. Plébiscitée par un grand nombre d'utilisateurs, elle est une référence dans sa catégorie. La Max Flo est une pompe hayward auto amorçante et s'adapte à l'eau salée pour une compatibilité avec les électrolyseurs.
Pompe Piscine Swimmey (Nocchi) Pentair - 1cv 13m³/h Monophasée (SW19)La pompe Swimmey de Pentair est une pompe autoamorçante présentant un excellent rapport qualité prix. La pompe Swimmey est compatible avec le traitement au sel. Elle remplace l'ancien modèle NOCCHI et s'adapte en remplacement sans modification de plomberie.- Pompe Piscine Swimmey (Nocchi) Pentair - 1.5cv 19m³/h Monophasée (SW28)La pompe Swimmey de Pentair est une pompe autoamorçante présentant un excellent rapport qualité prix. La pompe Swimmey est compatible avec le traitement au sel. Elle remplace l'ancien modèle NOCCHI et s'adapte en remplacement sans modification de plomberie.
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UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C.
20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO
RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF
1934
For the month of July 2020
Commission File No.
001-38145
Auryn Resources
Inc.
(Translation of registrant’s name into English)
Suite 600, 1199 West Hastings
Street
Vancouver, British Columbia, V6E 3T5
Canada
(Address of principal executive office)
Indicate by check mark
whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F
Form
20-F [ ] Form
40-F [X]
Indicate by check mark
if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1) [ ]
Indicate by check mark
if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7) [ ]
SUBMITTED
HEREWITH
Exhibits
Technical Report,
Updated Mineral Resource Estimate and Preliminary Economic
Assessment on the Homestake Ridge Gold Project amended and
restated June 24, 2020
Consent of
Qualified Person – David Stone, P.Eng. amended and
restated June 24, 2020
Consent of
Qualified Person – Philip A Geusebroek, M.Sc., P.Geo
amended and
restated June 24, 2020
Consent of
Qualified Person – Paul Chamois, M.Sc.(A), P.Geo amended and
restated June 24, 2020
Consent of
Qualified Person – Mary Mioska, P.Eng. amended and
restated June 24, 2020
SIGNATURE
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
| AURYN RESOURCES INC. |
| |
|
|
|
|
Date: July 21, | By: | /s/ Stacy |
|
|
| Stacy |
|
|
| Chief |
|
Technical
Report,
Updated
Mineral Resource Estimate and
Preliminary
Economic Assessment
on
the
HOMESTAKE
RIDGE GOLD PROJECT
SKEENA
MINING DIVISION
BRITISH
COLUMBIA
Latitude
55° 45′ 12.6″ N and Longitude 129° 34′ 39.8″
W
Qualified Persons:
Paul
Chamois, P.Geo.
Philip
Geusebroek, P.Geo.
Mary
Mioska, P.Eng.
David
M.R. Stone, P.Eng.
Prepared by:
MINEFILL
SERVICES, INC.
PO BOX
725
BOTHELL,
WASHINGTON
Effective Date: May 29, 2020
Amended and Restated: June 24, 2020
IMPORTANT NOTICE
This
report was prepared as a National Instrument 43-101 Technical
Report for the exclusive use of Auryn Resources Ltd.
(Auryn) by MineFill Services, Inc., (MineFill).
The quality of information, conclusions, and estimates contained
herein is consistent with industry standards based on i)
information available at the time of preparation, ii) data supplied
by outside sources, and iii) the assumptions, conditions, and
qualifications as set forth in this report. This report is intended
for use by Auryn subject to
the terms and conditions of its contract with MineFill. Except for
the purposes legislated under Canadian provincial and territorial
securities law, any other use of this report by any third party is
at that party’s sole risk.
Homestake
Ridge Project
NI43-101F1
Technical Report
Table of Contents
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NI43-101F1
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List of Tables
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Homestake
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NI43-101F1
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List of Figures
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viii
Homestake
Ridge Project
NI43-101F1
Technical Report
1.
SUMMARY
1.1
Overview
The
subject of this document is the Homestake Ridge gold project
located in the so-called Golden Triangle of north-central British
Columbia. The Project is owned and operated by Auryn
Resources Inc. (the “Company” or “Auryn”)
of Vancouver, B.C. Auryn is listed on the Toronto stock
exchange and the New York Stock Exchange.
The
Homestake Ridge Project comprises 7,484.37 hectares (ha) of mineral
claims and crown grants and is located approximately 32 km
north-northwest of the tidewater communities of Alice Arm and
Kitsault, BC.
1.2
Geology
The
Project is located within the prolific Iskut-Stewart-Kitsault Belt
which hosts several precious and base metal mineral deposits.
Diverse mineralization styles include stratabound sulphide and
silica-rich zones, sulphide veins, and disseminated or stockwork
sulphides. Mineralization is related to Early Jurassic
feldspar-hornblende-phyric sub-volcanic intrusions and felsic
volcanism, which commonly occurs with zones of pyrite-sericite
alteration. Numerous genetic models can be proposed for the
area and local deposits present a broad range of
characteristics.
The
Project lies within the metallogenic region known as the Stewart
Complex. Described as the contact of the eastern Coast
Plutonic Complex with the west-central margin of the successor
Bowser Basin, the Stewart Complex ranges from Middle Triassic to
Quaternary in age and is comprised of sedimentary, volcanic, and
metamorphic rocks.
The
Project covers the transition between the sedimentary and volcanic
rocks of the Upper Triassic to Lower Jurassic Stuhini Group, a
complex sequence of Lower to Middle Jurassic sedimentary, volcanic,
and intrusive rocks of the Hazelton Group and sedimentary rocks of
the Upper to Middle Jurassic Bowser Lake Group.
In the
northern portion of the Project, at the headwaters of Homestake
Creek, rhyolitic volcanic rocks occur at the base of the Salmon
River sediments.
The
eastern portion of the Project is dominated by the Middle to Upper
Jurassic Bowser Basin Group which conformably overlies the thin
bedded graphitic argillites of the Salmon River
formation.
Effective Project |
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Page
1-1
Homestake
Ridge Project
NI43-101F1
Technical Report
Structure
on the Project largely reflects northeast-southwest compression
that has continued from the Jurassic to present day. Recent
drilling and mapping suggest that the local stratigraphy has
undergone several deformation events including uplift and local
extension of the Stuhini and lower Hazelton stratigraphy.
Large northeast trending ankerite bearing faults have been mapped
and related to Tertiary east-west extension.
1.3
Mineralization
The
main zones of the Homestake Ridge deposit are the Homestake Main
(HM), Homestake Silver (HS), and South Reef (SR).
The
Homestake Main zone is the more copper-rich of the zones, with both
gold-rich and silver-rich variants and an apparent trend of
increasing copper grade with depth. Grades for gold typically
range from 0.1 g/t Au to 2 g/t Au with some intercepts measuring
into the hundreds of grams per tonne and averaged at 7.75 g/t Au.
Silver grades are generally in the 1.0 g/t Ag to 100 g/t Ag range
but can be as high as hundreds and even thousands of grams per
tonne. The average silver grade in the Homestake Main zone is
68.6 g/t Ag. Copper grades vary from parts per million to
several percent, with mean grades observed to increase
significantly with depth.
The
Homestake Silver zone, located approximately 0.5 km southeast of
Homestake Main, contains very little copper, and is relatively
higher in silver content. Silver grades at Homestake Silver
average 154 g/t Ag, approximately double that of the Homestake Main
zone (68.6 g/t Ag) and 26 times that of South Reef (5.8 g/t
Ag). Gold grades at Homestake Silver typically range up to
several g/t Au and averaged 3.5 g/t Au in the samples contained
within the interpreted zone boundaries. Copper content is
comparatively low, however, geochemically significant, and
generally measures between 10 ppm Cu and 500 ppm
Cu.
The
South Reef zone is comprised of two narrow sub-parallel tabular
bodies which strike at approximately 120° to 130° and dip
70°NE to 80°NE. To date, only twelve holes have
intersected significant mineralization, as such characterization of
the structure and grades is preliminary. The zones measure
one metre to three metres in thickness and have been traced for
approximately 300 m vertically and 400 m along strike.
Silver grades at SR average 5.8 g/t Ag in the vein samples.
This is offset by high gold values, which average 5.9 g/t
Au.
The
Homestake deposits are commonly vertically zoned from a base metal
poor Au-Ag-rich top to an Ag-rich base metal zone over a vertical
range of 250 m to 350 m. The silver-galena-sphalerite veins of the
Homestake Silver Zone exhibit many of these features.
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Page
1-2
Homestake
Ridge Project
NI43-101F1
Technical Report
1.4
Exploration Highlights
Since
acquiring the Homestake Ridge Project in late 2016, Auryn has
completed extensive exploration across the Property to advance
additional targets to the drill ready stage. This work has
included geological mapping, rock and soil geochemical sampling,
portable X-ray fluorescence and shortwave infrared surveys,
geophysical (IP) surveying, the re-logging of historical drill
core, geochronological studies and airborne VTEM geophysical
surveys along with reprocessing of historic geophysical survey
data.
The
Homestake Ridge property hosts a number of other mineral
occurrences, however, none of these targets have NI43-101 complaint
Mineral Resources.
1.5
Mineral Resources
Resources were estimated considering a potential underground mining
scenario. At a cut-off grade of 2.0 g/t gold equivalent
(AuEq), Indicated Mineral Resources were estimated to total 0.736
million tonnes (Mt) at average grades of 7.02 g/t Au, 74.8 g/t Ag,
and 0.18 percent Cu. At the same cut-off grade, Inferred
Mineral Resources were estimated to total 5.545 Mt at average
grades of 4.58 g/t Au, 100.0 g/t Ag, and 0.13 percent Cu as shown
in Table 1-1.
Mineral Resources – Effective Date: December 31,
2019
Auryn Resources Inc. – Homestake Ridge Project
Classification And | | | | ||||||
| | | | | | | | ||
Indicated |
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HM | | 7.02 | 74.8 | 0.18 | 0.077 | 165,993 | 1.8 | 2.87 | 1.25 |
Total | | | | | | | | | |
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Inferred |
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HM | | 6.33 | 35.9 | 0.35 | 0.107 | 355,553 | 2.0 | 13.32 | 4.14 |
HS | | 3.13 | 146.0 | 0.03 | 0.178 | 337,013 | 15.7 | 2.19 | 13.20 |
SR | | 8.68 | 4.9 | 0.04 | 0.001 | 124,153 | 0.1 | 0.36 | 0.00 |
Total | | | | | | | | | |
Notes:
1.
Canadian Institute of Mining, Metallurgy and Petroleum (CIM)
Definition Standards for Mineral Resources and Mineral Reserves
dated May 10, 2014 (CIM (2014) definitions), as incorporated by
reference in NI43-101, were followed for Mineral Resource
estimation.
2.
Mineral Resources are estimated at a cut-off grade of 2.0 g/t
AuEq.
Effective Project |
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Page
1-3
Homestake
Ridge Project
NI43-101F1
Technical Report
3.
AuEq values were calculated using a long-term gold price of
US$1,300 per ounce, silver price at US$20 per ounce, and copper
price at US$2.50 per pound and a US$/C$ exchange rate of 1.2. The
AuEq calculation included provisions for metallurgical recoveries,
treatment charges, refining costs, and transportation.
4.
Bulk density ranges from 2.69 t/m3 to 3.03
t/m3
depending on the domain.
5.
Differences may occur in totals due to rounding.
6.
The Qualified Person responsible for this Mineral Resource Estimate
is Philip A. Geusebroek of Roscoe Postle Associates Inc. (RPA), now
part of SLR Consulting Ltd (SLR).
7.
The reader is cautioned that Mineral Resources that are not Mineral
Reserves do not have demonstrated economic viability.
8.
HM=Homestake Main Zone, HS= Homestake Silver Zone, and SR= South
Reef Zone.
The
Qualified Person is of the opinion that the practices and methods
used by Auryn to estimate Mineral Resources at the Project are in
accordance with the CIM (2014) definitions, and that the December
31, 2019 Mineral Resource estimate is reasonable and acceptable for
use in the Preliminary Economic Assessment (PEA).
1.6
Mineral Reserves
There
are no Mineral Reserves on the Homestake Ridge
Project.
1.7
Mining Operations
The PEA
mine plan and production schedule were generated with Deswik Stope
Optimizer software on the basis of the undated block model and
resource wireframes supplied by Auryn. The principal mining method
was longhole open stoping in a longitudinal direction, with a
minimum mining width of 2.5 m. A mining cutoff grade of 3.5
gpt gold-equivalent was used to define the stope
outlines.
The
resulting mine production schedule consists of 2.87 M stope tonnes
and 0.55 M mineralized development tonnes for a total of 3.42 Mt
grading 5.41 gpt Au, 84.31 gpt Ag, 0.13 percent Cu and 0.12 percent
Pb. The nominal mining rate is 900 tpd for an overall mine life of
13 years.
1.8
Processing
Processing
of Homestake Ridge mineralization will be complicated by the
difference in metal contents across the 3 principal deposits.
The Homestake Main mineralization is high in copper, low in lead,
and moderate in zinc. The Homestake Silver and South Reef
mineralization has low copper grades. Homestake Silver has
relatively low gold grades but high lead, zinc, and silver
grades. South Reef is essentially just gold with a minor
amount of copper.
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Page
1-4
Homestake
Ridge Project
NI43-101F1
Technical Report
The PEA
focuses on an optimal process strategy consisting of crushing and
grinding, followed by gravity recovery of a gold concentrate, then
selective flotation to produce base metal concentrates (one for
copper and one for lead/zinc) and finally regrinding and flotation
to produce a pyrite concentrate. Cyanide leaching of the
pyrite concentrate would be used to produce doré
bars.
1.9
Site Infrastructure
The
Homestake Ridge Project is a remote greenfields site with no
existing roads, power, water or camp infrastructure.
Development of the project will require:
■
Upgrading and
extending the current access road to allow the movement of freight,
consumable supplies and manpower
■
Installing local
hydro or diesel power, or connecting to the nearby BC Hydro
grid
■
Construction of a
person-camp to allow drive-in, drive-out (DIDO) manpower
rosters
■
Construction of a
900 tpd metallurgical plant
■
Construction of a
tailings dam and tailings storage facilities.
The
ancillary mine facilities include:
■
Core storage and
exploration offices
■
An assay
laboratory
■
Equipment
maintenance shops
■
Mine administration
and technical offices
■
Storage for diesel
fuel and lubricants
■
Explosives
magazine
■
Potable and fire
water.
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Page
1-5
Homestake
Ridge Project
NI43-101F1
Technical Report
1.10
Capital Costs
The
pre-production capital cost has been estimated at US$88.4 million
(C$126.3 million) including all direct and indirect costs. The PEA
is based on contractor owned and operated equipment and manpower. A
contingency of 15 percent has been applied to all direct facility
costs.
Sustaining
costs have been estimated at US$85.8 million after a US$3.5 million
credit for the end-of-mine salvage.
1.11
Operating Costs
Operating
costs were developed from unit rate costs and benchmark costs for
projects of a similar size and scope. The all-in operating
costs have been estimated at US$89.40 per tonne
milled.
1.12
Financial Model
The
economic analysis was carried out using standard discounted
cashflow modelling techniques. The production and capital estimates
were estimated on an annual basis for the life of
mine.
Applicable
royalties were applied along with current Federal and Provincial
taxes and incorporated into the cashflow model. The economic
analysis was carried out on a 100 percent project basis. Given the
location and relatively uncomplicated nature of the project, the
Base Case uses a 5 percent discount factor in arriving at the
project Net Present Value (NPV). Standard payback calculation
methodology was also utilized.
project generates a Before-Tax cashflow of US$277 million (US$184
million After-Tax) over 13 years or roughly US$21 million in
free cashflow per year as shown in Table
1-2 below.
Financial Indicators
Qualified | | |
NPV | | |
NPV | | |
NPV | | |
IRR | | |
Payback | 34 | 36 |
As required by NI43-101, the author cautions the reader that the
PEA is preliminary in nature, that it includes Inferred mineral
resources that are considered too speculative geologically to have
the economic considerations applied to them that would enable them
to be categorized as mineral reserves, and there is no certainty
that the preliminary economic assessment will be
realized.
1.13
Qualified Persons Opinion
Based
on the analyses herein, it is the opinion of the Qualified Person
that the Homestake Ridge Project requires further study.
MineFill recommends the project be advanced to a Feasibility level
of evaluation.
Effective Project |
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Page
1-6
2.
INTRODUCTION
2.1
The Issuer
This
Technical Report has been prepared for Auryn which is incorporated
in British Columbia, Canada. The Company has offices in Vancouver,
B.C., and is listed on the Toronto Stock Exchange and the
NYSE-American, with its common shares trading under the symbols
AUG.TO and AUG, respectively.
The
subject of this document is the Homestake Ridge Gold Project
located in the so-called Golden Triangle of north-central British
Columbia. The Company is the 100 percent owner and operator of the
Homestake Ridge Project which comprises 7,484.37 ha of mineral
claims and crown grants.
2.2
Terms of Reference
This
document presents the results of an updated Mineral Resource
Estimate and Preliminary Economic Assessment (PEA) of the Homestake
Ridge Project. The PEA was prepared in accordance with standard
industry practices and in accordance with CIM Definition Standards
on Mineral Resources and Reserves (dated May 10, 2014), and
Canadian Securities Administrators National Instrument 43-101
(Standards of Disclosure for Mineral Projects) dated June 30, 2011.
The effective date of this Technical Report is May 29,
2020.
2.3
Sources of Information
The
Homestake Ridge Project has been the subject of several prior
NI43-101 compliant Technical Reports. The most recent was completed
by Roscoe Postle Associates Inc. (RPA) dated September 29,
2017 (later amended on October 23, 2017). This document included an
updated mineral resource estimate.
Prior
Technical Reports on Homestake Ridge include:
■
A 2013 Technical
Report dated June 7, 2013 by Macdonald and Rennie for Homestake
Resource Corporation.
■
A 2011 Technical
Report dated May 20, 2011 by RPA for Bravo Gold Corp.
■
A 2010 Technical
Report dated June 28, 2010 by Scott Wilson RPA for Bravo Gold
Corp.
■
A 2007 Technical
Report dated April 11, 2007 and amended on June 3, 2008 by Folk and
Makepeace for Bravo Venture Group.
Effective Project |
|
Page
2-1
Bravo
Gold also completed a number of engineering studies on the site
including:
■
A January 24, 2012
geotechnical assessment of the proposed new road extension for the
Homestake Ridge Access Road by Golder Associates.
■
A February 27, 2012
preliminary geotechnical assessment of the proposed mine
infrastructure sites for the Homestake Ridge Project by Golder
Associates.
■
A Road Design
Package for the Homestake Ridge access road by AllNorth Consultants
dated March 20, 2009.
■
A Kitsault River
Road Review Inspection report by AllNorth Consultants dated
August 26, 2010.
■
A Homestake Ridge
Mainline Access Road Feasibility Study by AllNorth Consultants
dated March 3, 2012.
■
Conceptual mine
site layouts and run of river hydropower assessments by Knight
Piesold dated June 1, 2011.
■
A preliminary power
study supply assessment by Knight Piesold dated April 23,
2011.
■
A report on
integration of Hydroelectric power within the mine development
concepts by Knight Piesold dated June 1, 2011.
■
A plant site and
tailings storage facility alternatives assessment by Knight Piesold
dated May 19, 2011.
■
A conceptual cost
estimate for tailings disposal by Knight Piesold dated May 13,
2011.
■
An October 11, 2011
site inspection report by Knight Piesold.
■
A preliminary ore
sorting investigation and benchtop amenability test by Commodas
Ultrasort/Tomra Sorting Solutions dated June 14, 2012.
The
project library includes a number of other supporting documents,
drawings and historical data related to hydroelectric power in the
Kitsault region, at the adjacent Kitsault Lake, and at
Anyox.
Effective Project |
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Page
2-2
2.4
Qualified Persons
Qualified Persons for this Technical Report are as listed in
Table 2-1 below.
Qualified Persons
| | | |
| MineFill | All Sections Section Section | |
| RPA | Sections Section | |
| RPA | Sections | |
| OneEighty | Section Section | |
Paul Chamois, M.Sc. (A), P.Geo., Principal Geologist with RPA and
an independent QP, visited the Project from August 26 to 28, 2017.
During the visit, Mr. Chamois examined core from the on-going
drilling program, confirmed the local geological setting, reviewed
the core handling and data collection methodologies, and
investigated factors that may affect the Project. Due to the
advanced nature of the Project, no independent samples were taken
during the visit.
In the QP’s opinion, the limited work carried out during 2018
and 2019 is not material to the project. None of the post-2017
exploration work was utilized in the resource estimation outlined
in Section 14, nor in the Preliminary Economic Assessment. The
QP’s have reviewed Auryn’s regulatory filings,
assessment reports, news releases and databases to verify that no
material work was completed on the property post 2017.
None of the other Qualified Persons have visited the project
site.
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2-3
2.6
Terms and Definitions
Units
of measurement used in this report conform to the metric
system.
a | annum | L | litre |
A | ampere | lb | pound |
bbl | barrels | L/s | litres |
btu | British | m | metre |
°C | degree | M | mega |
C$ | Canadian | m2 | square |
cal | calorie | m3 | cubic |
cfm | cubic |
| micron |
cm | centimetre | MASL | metres |
cm2 | square | g | microgram |
d | day | m3/h | cubic |
dia | diameter | mi | mile |
dmt | dry | min | minute |
dwt | dead-weight | m | micrometre |
°F | degree | mm | millimetre |
ft | foot | mo | month |
ft2 | square | mph | miles |
ft3 | cubic | Mtpa | Million |
ft/s | foot | Mtpd | Million |
g | gram | MVA | megavolt-amperes |
G | giga | MW | megawatt |
Gal | Imperial | MWh | megawatt-hour |
g/L | gram | oz | Troy |
Gpm | Imperial | oz/st, | ounce |
| gpt | gram | ppb | part |
gr/ft3 | grain | ppm | part |
gr/m3 | grain | psia | pound |
ha | hectare | psig | pound |
hp | horsepower | RL | relative |
hr | hour | s | second |
Hz | hertz | t | tonne |
in2 | square | tpa | tonnes |
J | joule | tpd | tonnes |
k | kilo | US$ | United |
kcal | kilocalorie | USg | United |
kg | kilogram | USgpm | US |
km | kilometre | V | volt |
km2 | square | W | watt |
km/h | kilometre | wmt | wet |
kPa | kilopascal | wt% | weight |
kVA | kilovolt-amperes | yd3 | cubic |
kW | kilowatt | yr | year |
kWh | kilowatt-hour |
|
|
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3.
RELIANCE ON OTHER EXPERTS
The
authors are not qualified to provide an opinion or comment on
issues related to legal agreements, royalties, permitting matters,
and taxes.
The
authors of this Technical Report have relied on non-QPs for Section
4.3, Mineral Tenure.
For the
purpose of this report, the Qualified Person’s have relied on
ownership information provided by Auryn and Broughton Law
Corporation (Broughton Law), regarding title to the Homestake Ridge
Project. Broughton Law provided a legal review and opinion dated
September 7, 2016. This information was used in Sections 1 and 4 of
this report. The Qualified Persons have not researched property
title or mineral rights for the Homestake Ridge Project and
expresses no opinion as to the ownership status of the
property.
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Page
3-1
4.
PROPERTY DESCRIPTION AND LOCATION
4.1
Location
Homestake Ridge Project covers 7,484.37 hectares and is located 32
km southeast of Stewart, BC, and approximately 32 km
north-northwest of the tidewater communities of Alice Arm and
Kitsault, BC (Figure 4.1). The
property is located on 1:50,000 scale NTS map 102/P13.
The
four claim blocks comprising the Project are located within a
rectangular area extending for a distance of approximately 23 km in
a north-south direction and approximately 13 km in an east-west
direction. The claim block hosting the known Mineral Resources is
centered on approximately 55° 45′ 12.6″ N latitude and
129° 34′ 39.8″ W longitude on Terrain Resource Integrated
Management (TRIM) maps 103P072 and 103P073 and lies within Zone 9
of the UTM projection using the NAD’83 datum.
Project Location Map
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4-1
4.2
Project Ownership
On June
14, 2016, Auryn announced that it had entered into a binding letter
agreement with Homestake Resource Corporation (Homestake) whereby
it would acquire Homestake under a plan of arrangement (the
Arrangement). In consideration for 100 percent of Homestake’s
issued and outstanding shares, Auryn would issue approximately 3.3
million shares to Homestake shareholders. During the Arrangement
process, Auryn also agreed to provide Homestake with a demand loan
of up to C$150,000 on an interest free, unsecured basis. On
September 8, 2016, Auryn announced that it had completed the
Arrangement and that Homestake had become a wholly owned subsidiary
of Auryn.
4.3
Mineral Tenure
Project comprises four non-contiguous blocks consisting of seven
crown granted claims covering 96.712 ha and 37 mineral claims
covering 7,484.37 ha (Figure 4.2).
Table 4-1 lists the mineral claims
along with the relevant individual tenure information including
tenure number and name, issue and expiry dates, title type, and
area. Table 4-2 lists the crown granted
claims.
The
crown grants include surface rights whereas the mineral claims do
not.
There
are no holding costs or work expenditure requirements for the crown
grants other than roughly C$300 per year in property
taxes.
The
mineral claims are subject to minimum work requirements
of:
■
C$5 per hectare for
anniversary years 1 and 2;
■
C$10 per hectare
for anniversary years 3 and 4;
■
C$15 per hectare
for anniversary years 5 and 6; and
■
C$20 per hectare
for subsequent anniversary years.
in 2019, on the mineral claims shown in Table 4-1, amounted to C$860,000.
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Project
NI43-101F1
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Homestake Mineral Claims
Title | Claim | Owner | Client | Issue | Good to | Area | Protected | Tenure Sub Type | Title Type | Title Type | Tenure Type |
950714 | BRAVO N1 | HOMESTAKE RESOURCE | 202433 | February 19, | June 13, 2029 | 327.49 | N | CLAIM | Mineral Cell Title | MCX | M |
950719 | BRAVO N2 | HOMESTAKE RESOURCE | 202433 | February 19, | June 13, 2029 | 436.51 | N | CLAIM | Mineral Cell Title | MCX | M |
950722 | BRAVO N3 | HOMESTAKE RESOURCE | 202433 | February 19, | June 13, 2029 | 436.50 | N | CLAIM | Mineral Cell Title | MCX | M |
950724 | BRAVO N4 | HOMESTAKE RESOURCE | 202433 | February 19, | June 13, 2029 | 272.81 | N | CLAIM | Mineral Cell Title | MCX | M |
950725 | BRAVO N5 | HOMESTAKE RESOURCE | 202433 | February 19, | June 13, 2029 | 381.82 | N | CLAIM | Mineral Cell Title | MCX | M |
950726 | BRAVO N6 | HOMESTAKE RESOURCE | 202433 | February 19, | June 13, 2029 | 418.04 | N | CLAIM | Mineral Cell Title | MCX | M |
950727 | BRAVO N7 | HOMESTAKE RESOURCE | 202433 | February 19, | June 13, 2029 | 417.96 | N | CLAIM | Mineral Cell Title | MCX | M |
1011645 | KN HSR 1 | HOMESTAKE RESOURCE | 202433 | August 1, 2012 | March 9, 2023 | 273.86 | N | CLAIM | Mineral Cell Title | MCX | M |
1061421 | NR | HOMESTAKE RESOURCE | 202433 | August 25, 2006 | August 30, 2029 | 18.20 | N | CLAIM | Mineral Cell Title | MCX | M |
251427 | CAMBRIA 1 | HOMESTAKE RESOURCE | 202433 | May 6, 1986 | December 17, | 100.00 | N | CLAIM | Four Post Claim | MC4 | M |
251428 | CAMBRIA 2 | HOMESTAKE RESOURCE | 202433 | May 6, 1986 | December 17, | 75.00 | N | CLAIM | Four Post Claim | MC4 | M |
377241 | WK 1 | HOMESTAKE RESOURCE | 202433 | May 23, 2000 | December 17, | 250.00 | N | CLAIM | Four Post Claim | MC4 | M |
377242 | WK 2 | HOMESTAKE RESOURCE | 202433 | May 23, 2000 | December 17, | 500.00 | N | CLAIM | Four Post Claim | MC4 | M |
377243 | WK 3 | HOMESTAKE RESOURCE | 202433 | May 23, 2000 | December 17, | 400.00 | N | CLAIM | Four Post Claim | MC4 | M |
380949 | WK 4 | HOMESTAKE RESOURCE | 202433 | September 20, | December 17, | 450.00 | N | CLAIM | Four Post Claim | MC4 | M |
380950 | WK 5 | HOMESTAKE RESOURCE | 202433 | September 20, | December 17, | 450.00 | N | CLAIM | Four Post Claim | MC4 | M |
380951 | KW 1 | HOMESTAKE RESOURCE | 202433 | September 20, | December 17, | 25.00 | N | CLAIM | Two Post Claim | MC2 | M |
380952 | KW 2 | HOMESTAKE RESOURCE | 202433 | September 20, | December 17, | 25.00 | N | CLAIM | Two Post Claim | MC2 | M |
380953 | KW 3 | HOMESTAKE RESOURCE | 202433 | September 20, | December 17, | 25.00 | N | CLAIM | Two Post Claim | MC2 | M |
383016 | KW 5 | HOMESTAKE RESOURCE | 202433 | November 28, | December 17, | 25.00 | N | CLAIM | Two Post Claim | MC2 | M |
383017 | KW4 | HOMESTAKE RESOURCE | 202433 | November 28, | December 17, | 25.00 | N | CLAIM | Two Post Claim | MC2 | M |
383037 | WK 6 | HOMESTAKE RESOURCE | 202433 | November 28, | December 17, | 150.00 | N | CLAIM | Four Post Claim | MC4 | M |
383038 | WK 7 | HOMESTAKE RESOURCE | 202433 | November 28, | December 17, | 400.00 | N | CLAIM | Four Post Claim | MC4 | M |
537435 | HR | HOMESTAKE RESOURCE | 202433 | July 20, 2006 | December 17, | 127.45 | N | CLAIM | Mineral Cell Title | MCX | M |
537436 | HRMARGIN 1 | HOMESTAKE RESOURCE | 202433 | July 20, 2006 | December 17, | 109.25 | N | CLAIM | Mineral Cell Title | MCX | M |
537437 | HRMARGIN2 | HOMESTAKE RESOURCE | 202433 | July 20, 2006 | December 17, | 54.60 | N | CLAIM | Mineral Cell Title | MCX | M |
538791 | HOMESTAKE RIDGE | HOMESTAKE RESOURCE | 202433 | August 5, 2006 | December 17, | 18.21 | N | CLAIM | Mineral Cell Title | MCX | M |
540533 | HOMESTAKE RIDGE | HOMESTAKE RESOURCE | 202433 | September 6, | December 17, | 18.20 | N | CLAIM | Mineral Cell Title | MCX | M |
540540 | HOMESTAKE RIDGE | HOMESTAKE RESOURCE | 202433 | September 6, | December 17, | 18.21 | N | CLAIM | Mineral Cell Title | MCX | M |
545945 | HOMESTAKE RIDGE | HOMESTAKE RESOURCE | 202433 | November 27, | December 17, | 18.20 | N | CLAIM | Mineral Cell Title | MCX | M |
565708 | HOMESTAKE RIDGE | HOMESTAKE RESOURCE | 202433 | September 7, | December 17, | 36.42 | N | CLAIM | Mineral Cell Title | MCX | M |
565709 | HOMESTAKE RIDGE | HOMESTAKE RESOURCE | 202433 | September 7, | December 17, | 18.21 | N | CLAIM | Mineral Cell Title | MCX | M |
565710 | HOME STAKE 7 | HOMESTAKE RESOURCE | 202433 | September 7, | December 17, | 18.20 | N | CLAIM | Mineral Cell Title | MCX | M |
598667 | VANGUARD GOLD | HOMESTAKE RESOURCE | 202433 | February 3, | December 17, | 18.21 | N | CLAIM | Mineral Cell Title | MCX | M |
598668 | VANGUARD | HOMESTAKE RESOURCE | 202433 | February 3, | December 17, | 54.66 | N | CLAIM | Mineral Cell Title | MCX | M |
1015450 | KINSKUCH NW2 | HOMESTAKE RESOURCE | 202433 | December 22, | December 17, | 1039.18 | N | CLAIM | Mineral Cell Title | MCX | M |
1015588 | HS SOUTH 1 | HOMESTAKE RESOURCE | 202433 | December 31, | December 17, | 36.44 | N | CLAIM | Mineral Cell Title | MCX | M |
|
| | |
| | |
|
|
|
|
|
Source:
Auryn, 2019
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Crown Grants
District | Claim | CTGVRNNGPR | PRCLTP | SRVRGNRLPL | STTFPRCLSR | Area | CRWNGRNTNO | Mining | Lot |
3975 | HOMESTAKE | Mineral Tenure | Primary | 37TR7 CASSIAR | Active | 20.902 | 4004/511 | SKEENA | CROWN GRANTED |
3978 | HOMESTAKE NO. 3 | Mineral Tenure | Primary | 37TR7 CASSIAR | Active | 13.962 | 4007/311 | SKEENA | CROWN GRANTED |
3977 | HOMESTAKE NO. 2 | Mineral Tenure | Primary | 37TR7 CASSIAR | Active | 15.042 | 4006/511 | SKEENA | CROWN GRANTED |
3976 | HOMESTAKE NO. 1 | Mineral Tenure | Primary | 37TR7 CASSIAR | Active | 20.283 | 4005/511 | SKEENA | CROWN GRANTED |
3980 | HOMESTAKE NO. 1 | Mineral Tenure | Primary | 37TR7 CASSIAR | Active | 4.702 | 5622/527 | SKEENA | CROWN GRANTED |
3979 | HOMESTAKE | Mineral Tenure | Primary | 37TR7 CASSIAR | Active | 0.919 | 5621/527 | SKEENA | CROWN GRANTED |
6322 | MILLSITE | Land Act | Primary | 1TR8 CASSIAR | Active | 20.902 | 8826/859 | SKEENA | CROWN GRANTED |
|
| | |
| | |
|
|
|
Source:
Auryn, 2019
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Source:
Auryn
Claims
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4.4
Royalties and Encumbrances
Homestake
earned a 100 percent interest in 14 Homestake Ridge mineral claims
through its option with Teck Cominco Limited, now Teck Resources
(Teck). Teck failed to exercise its back-in rights in 2008 but
retained a 2 percent net smelter return (NSR) royalty, 1 percent of
which could be purchased at a future date for C$1.0 million. On May
16, 2016 Homestake announced that it had closed an agreement with
Teck to purchase the 2 percent royalty and ancillary rights for
C$100,000, effectively extinguishing this royalty.
The
Coombes Claims (including Cambria 1, Cambria 2, KW1, KW2, KW3, KW4,
KW5, WK1, WK3, WK4, WK6 and WK7) are subject to a 2 percent NSR
royalty by virtue of an option agreement dated July 5, 2000. The
royalty includes a purchase right in favour of Homestake for
C$1,000,000.
The
crown grants (including DL 3975, DL 3976, DL 3977, DL 3978, DL
3979, DL 3980, and DL 6322) are subject to a 2 percent NSR royalty
which includes an annual advanced minimum royalty of C$50,000 in
favour of Alice Sullivan and Mildred Keller.
of the claims subject to royalty is attached in Figure 4.3.
4.5
Property Agreements
The
authors are not aware of any other underlying agreements,
obligations or back-in rights related to the Property other than
those disclosed herein.
4.6
Permitting Considerations
Auryn
Resources currently holds a Mineral and Coal Activities and Reclamation
Permit (Permit No. MX-1-603) that includes the
following approved work:
■
Camp with 1.0 ha of
disturbance
■
Geophysical surveys
of 50 line km
■
Surface drilling at
500 drill sites
■
2 km of exploration
trails.
The
above permit is secured with a C$68,000 reclamation bond and all
work must be complete by March 23, 2023.
The
Company has also been granted a Free Use Permit (No.
MX-1-603:2018-2023) for the harvesting of Crown timber on the Crown
granted lands.
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Source:
Auryn
Royalty
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4.7
Environmental Considerations
The
Homestake Ridge Property is a greenfield site with no known
pre-existing development or environmental liabilities.
4.8
Social License Considerations
Auryn
does not have any Community or Social Agreements in
place.
4.9
Comments on Section 4
The
authors are not aware of any significant factors or risks that may
affect access to the project site, or the right and ability to
perform work on the property.
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5.
ACCESSIBILITY, CLIMATE, LOCAL RESOURCES,INFRASTRUCTURE, AND
PHYSIOGRAPHY
5.1
Site Access
The
Homestake Ridge Project is located 32 km southeast of Stewart, BC,
at the southern extent of the Cambria ice field. Access to the
Project from the town of Kitsault is by boat/barge to the community
of Alice Arm. From there, an upgraded tractor trail follows an old
railway bed for a distance of 32 km into the area of the past
producing Dolly Varden silver mine, approximately four kilometres
from the southern boundary of the Project. From there, overgrown
mule trails lead to the historic workings of the Vanguard and
Homestake areas of the Project (Figure 5.1).
In the absence of upgraded road access, the site is only accessible
by helicopter as shown in Figure
5.1. Helicopters are
available for charter from either Prince Rupert, Terrace, or
Stewart.
5.2
Climate
Climate in the area is transitional, with moderately wet to dry,
warm summers, and cool, wet winters (Ministry of Forests, 1993)
driven by moist Pacific air that brings intense precipitation to
the windward slopes and adjacent mountains, and by the cold Arctic
air to pass down the Portland Canal through onto the Dixon Entrance
(Demarchi, 2011). The area is classified as Oceanic or Marine West
Coast and is characterized by moderately cool summers and mild
winters with a narrower annual range of temperatures compared to
sites of similar latitude. Climate data derived from historic
monitoring stations at Alice Arm, and more recent long-ranging
monitoring at Stewart and Nass Camp Table
5-1) indicates that
temperatures range from an average low of – 6°C in
January to an average high of 15°C in July. The mean
temperature for the year is 5°C.
area receives between 984 – 1,838 mm of precipitation each
year (expressed in mm of water Table
5-1). Rainfall peaks in October with 150 mm. Snowfall is
highest in December and January when accumulations are 287 cm and
86 cm, respectively, at Nass Camp (Government of Canada, 2019).
Precipitation and heavy fog often impact on airborne access to the
Project (RPA, 2017).
The
property is reported to be covered in snow from late September to
late June (Bryson, 2007). The ground is generally frozen throughout
the winter and breakup occurs between early March and late May
(Ministry of Forests, 1993). Rainfall / snowfall distribution
ranges from 45 – 55 percent (Knight Piesold,
2011).
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Source:
MineFill Services, Inc.
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Ridge Project
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Climatic Data
| | | |
Meteorological | | | |
Latitude | | | |
Longitude | | | |
Elevation | | | |
Distance | | | |
Period | | | |
Mean | | | |
Mean | | | |
Extreme | | | |
Extreme | | | |
Average | | | |
Average | | | |
Average | | | |
5.3
Local Resources and Infrastructure
The
nearest communities to the Homestake project site include the towns
of Kitsault and Alice Arm, roughly 35 km distant. Both of these
towns are essentially ghost towns with few residents and no
services.
Labour
and supplies for the project can be brought in from the community
of Terrace, which lies 185 km to the south, along Highway 113.
Terrace has a population of 11,643 (2016 census) and hosts a wide
range of supplies, services, and trained labour. Terrace is
serviced by three air carriers with daily scheduled
flights.
Stewart
with a population of 400 (2016 census) is located 240 km, by road,
from Kitsault. Stewart is well serviced, has trained labour with
mining expertise, and hosts a deep-sea port that has been used for
shipping ore and concentrate from other mines. Concentrates and
bulk supplies, such fuel, could be barged between Alice Arm and
Stewart, an ocean distance of some 225 km.
Kitwanga,
180 km by road from Kitsault, lies on the Canadian National Railway
mainline and Trans-Canada Highway 16. Like Stewart, Kitwanga has
served as a shipping centre for mineral ores and concentrates.
Mining is supported in the local communities and, historically,
companies have been able to form productive joint venture
partnerships with local First Nations.
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5.4
Physiography
5.4.1
Terrain
The
project area is situated in steep terrain on the geologic boundary
between the Coastal Belt and the Intermontane Belt, within an
elevation range of 500 to 1100 masl (Knight Piesold, 2011). The
project area lies at the transition from the Southern Boundary
Ranges to the Meziadin Mountains ecosections (iMapBC, 2020). The
Southern Boundary Ranges ecosection is an area of wet rugged
mountains that are capped with glaciers, small icefields and
exposed granitic and metamorphic bedrock. This area was heavily
impacted by large sheets of ice that originated along the crest of
the mountains and the area south of the Homestake Ridge Project is
bisected by the Portland Canal (Demarchi, 2011). The Meziadin
Mountains comprise the leeward side of the main Boundary Ranges and
extend west of the low Nass Basin. Ice that formed in the Boundary
Ranges moved east into the Nass Basin, coalescing with ice moving
south from the adjacent Skeena Mountains, then the entire ice mass
moved down out the Nass Valley to the Dixon Entrance or south
through Cranberry Upland Ecosection to the Skeena River valley. The
mountain summits still have small icefields or glaciers (Demarchi,
2011).
The
area is characterized by steep headwater streams and gullies that
drain the mountainsides, carrying water, sediment and organic
materials to the fans and floodplains that line valley bottoms.
Lakes head some valleys. Small wetlands are common on floodplains,
but extensive wetlands are uncommon (Price and McLennan,
2001).
5.4.2
Vegetation
The
Project overlays a south-southeast trending ridge at the headwaters
of the Kitsault River and the lower portions of the Kitsault and
Little Kitsault Glaciers. The eastern and southern portions of the
property at lower elevations is subalpine forest, comprised of
subalpine fir, western hemlock, Roche spruce, and mountain hemlock.
East of this ridge, the subalpine forest is broken up by a large
slide area that is covered by slide alder, grass, and lichen.
Alpine areas are extensive at higher elevations, but are mainly
barren rock or ice covered. Many large remnant icefields and
glaciers remain on the summits north-west of the project area
(Demarchi, 2011). The upper slopes are populated by alpine grass,
moss, and lichen with intermittent patches of dwarf alpine spruce
(Knight and Macdonald, 2010).
Regionally,
the vegetation in the area is driven by the transitional nature of
the climate on the leeward side of the Coast Mountains, and
consequently combines elements of both coastal and interior flora
(BC Ministry of Forests, 1993). In the valley bottoms, in the
subalpine area, the understory vegetation includes a wide variety
of shrub and herbaceous species, including salmonberry, bunchberry,
various currants, five-leaf bramble, common snowberry, vine maple,
sword fern, twinflower, deer fern, western trillium and others
(Wright and Ebnet, nd). In the lower slopes of Portland Canal, the
forests are either very wet, such as coastal western hemlock or,
cold and wet, such as the subalpine mountain hemlock forests that
occur on all the middle elevation slopes (Demarchi,
2011).
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There
are no federally or provincially identified plant species at risk
in the project area (BC Conservation Data Centre, 2020). The
nearest observed plant species at risk is Polystichum setigerum
(Alaska holly fern), observed in 1975 in lower Kitsault River
approximately 2.5 km upstream from Alice Arm, classified as being
of “special concern” (BC Conservation Data Centre,
2020).
5.5
Seismicity
town of Stewart is located in a zone of low to moderate seismicity
with a peak ground acceleration of 0.031g for events with a 10
percent exceedance in 50 years (e.g. one in 1000-year event). As
can be seen in Figure 5.2 earthquake
frequency map, the main source of seismic risk is from the Cascadia
subduction zone, located 200 km from the Project site, off the
coast of British Columbia.
Source:
Natural Resources Canada
for Events in the Past 50 Years
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5.6
Comments on Section 5
The
Homestake Ridge Project is a remote greenfields site with no
existing roads, power, water or camp infrastructure. Development of
the project will require:
■
Upgrading and
extending the current access road to allow the movement of freight,
consumable supplies and manpower
■
Installing local
hydro or diesel power, or connecting to the nearby BC Hydro
grid
■
Construction of a
person-camp to allow drive-in, drive-out (DIDO) manpower
rosters
■
Development of
local water resources for potable and non-potable water
consumption.
In the
opinion of the Qualified Persons, the Homestake Ridge Project site
offers adequate surface rights and land suitable for the
construction of a processing plant, tailings facility, waste rock
dumps, and a person-camp. The project site has several suitable
sources of water pending the necessary approvals.
The
required infrastructure for project development is discussed in
Section 18 of this Technical Report, and the capital required is
included in the Financial models.
Winter
conditions are expected to prevail from October through to the
following May, and this may impair year-round operations if the
property were to be placed in production.
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5-6
6.
HISTORY
The
following Property History is taken from RPA (2017).
6.1
Prior Ownership
Claims
were first staked at the Homestake group between 1914 and 1917 and,
in 1918, the claims were bonded to the Mineral Claims Development
Company (MCDC). MCDC was reorganized into the Homestake Mining and
Development Company (Homestake Development) in 1921.
6.2
Exploration History
The
following is taken from Macdonald and Rennie (2016).
The
Homestake Ridge property comprises two areas of historic
exploration. The Homestake and the Vanguard groups have been tested
by past explorers starting in the early 1900s after the discoveries
at Anyox and in the Stewart region. Claims were first staked at the
Homestake group between 1914 and 1917 and, in 1918, the claims were
bonded to the MCDC. MCDC was reorganized into Homestake Development
in 1921. Limited surface and underground work was done on the
property. In 1925, the claims were given “Crown Grant”
status. In 1926,
Homestake
Development and three other groups bonded to the interests of C.
Spencer. The option was abandoned, with no further work being done
on the property (Knight and Macdonald, 2010).Arm staked the area
and conducted surface trenching, limited underground work and
drilled seven holes to an aggregate depth of 58.2 m, on the Lucky
Strike and Cascade claims which comprise part of the Homestake
group (Knight and Macdonald, 2010).
In
1966, Canex Aerial Exploration Ltd. (Canex) undertook a program of
prospecting, geochemical sampling, electromagnetic (EM) surveying,
and chip sampling in the Vanguard area. In 1967, Amax Exploration
conducted and extended examination of the Vanguard group but did
not return (Folk and Makepeace, 2007). Dwight Collison died in
1979.
In
1979, Newmont Exploration of Canada Ltd. (Newmont) optioned part
the property, known as the Wilberforce group, from Collison’s
widow, Ruby Collison. The Wilberforce group excluded the original
Homestake and Vanguard claims. Newmont explored for near surface,
massive sulphides conducting magnetometer and Max-Min geophysical
surveys, geological mapping, and trenching. A total of 595 soil
samples and 82 rock samples were assayed.
Newmont
terminated the option in late 1980 (Folk and Makepeace,
2007).
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6-1
Caulfield
Resources Ltd. explored over the Vanguard group in 1981 taking 102
soil samples and conducting 5.25 line km of ground magnetic
surveys, but no subsequent work was done (Folk and Makepeace,
2007).
Homeridge
Resources Ltd. optioned the property from Ruby Collison in 1984,
but no work was done (Bryson, 2007). The claims were allowed to
lapse in 1986, were re-staked and optioned to Cambria Resources
Ltd. (Cambria), which completed geological mapping,
lithogeochemical sampling, trenching, and 4.3 line km of IP and
resistivity surveying. Weather deferred drilling for that year and
the ground was eventually optioned to Noranda Exploration Company
Limited (Noranda) (Folk and Makepeace, 2007).
Between
1989 and 1991, Noranda consolidated ground by optioning more area
including the Cambria (formerly Collison), Homestake, and Vanguard
claims. A 44.3 km grid was cut along which magnetometer and IP
surveys were performed in addition to geological mapping. A total
of 1,930 rock samples and 1,943 silt and soil samples were taken.
Twelve diamond drill holes were cored (diameter unknown) for an
aggregate depth of 1,450.05 m (Folk and Makepeace,
2007).
Teck
acquired the current Homestake Ridge property in 2000 via option
agreements and staking. From 2000 to 2002, Teck conducted
geochemical and geological surveys, trenching, and diamond
drilling, exploring for volcanogenic massive sulphide (VMS)
deposits. A total of 21 NQ (47.6 mm dia.) holes were drilled to an
aggregate depth of 4,374.6 m yielding 618 core samples. In
addition, 778 rock samples were analyzed by Inductively Coupled
Plasma (ICP) multi-element geochemistry plus Au and another 31
samples were subjected to “whole rock” X-Ray
Fluorescence (XRF) analysis (Folk and Makepeace,
2007).
From
2010 to 2012, Homestake completed additional surface exploration
including further mapping, soil and rock sampling and 13.54 line km
of IP geophysical surveys, and diamond drilling.
In 2011
a new discovery was made 800 m to the southwest of, and parallel
to, the previously discovered Main Homestake and Homestake Silver
deposits. This area, known as the South Reef target was tested by
three holes with all three intersecting +30 g/t gold
mineralization.
During
2012, Homestake completed two phases of drilling focussed on the
delineation and extension of the South Reef target. The second
phase of drilling was funded by Agnico Eagle Mines Limited (Agnico
Eagle) as part of an option agreement (see below). The 2012
drilling was successful in identifying an approximate 250 m strike
by 250 m down dip before ending in, or being offset by, a major
fault structure. Mineralization is open along strike to the
northwest. Other targets on the property remain to be
explored.
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Agnico
Eagle optioned the property from Homestake in 2012. In 2013, Agnico
Eagle completed an exploration program consisting of geological
mapping, soil sampling (785 samples), approximately 21 line km of
ground geophysical surveying including IP/resistivity and magnetics
and a 10-hole drilling program totalling 3,947.24 m. The drilling
was meant to test various exploration targets outside of the
Homestake Main and Homestake Silver deposits (Swanton et al.,
2013). In 2014, Agnico Eagle completed a limited amount of
prospecting, reconnaissance geological mapping and rock sampling
(57 samples) as well as a 6-hole drilling program totalling 2,578 m
designed to test the Slide Zone. The drilling suggested that the
Slide Zone is concordant with the Homestake Main and Homestake
Silver Zones and trends north northwesterly and dips steeply to the
northeast.
6.3
Production
There
has been no historic production at the Homestake Ridge
property.
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7.
GEOLOGICAL SETTING AND MINERALIZATION
7.1
Regional Geology
Section
7 of this report is taken from Macdonald and Rennie
(2016).
Four
major building blocks constitute the terrane superstructure of
northwestern British Columbia (Colpron and Nelson (2011): a western
block of poly-deformed, metamorphosed Proterozoic to middle
Paleozoic peri-continental rocks (Nisling Assemblage); an eastern
block of exotic oceanic crustal and low-latitude marine strata
(Cache Creek Terrane); central blocks including Paleozoic Stikine
Assemblage and Triassic arcvolcanic and flanking sedimentary rocks
of Stikine Terrane; and overlying Late Triassic to Middle Jurassic
arc-derived strata of the Whitehorse Trough (including the Inklin
overlap assemblage).
The
following description of the Regional Geology is derived from
Kasper and Metcalfe (2004), Knight and Macdonald
(2010).
The
Homestake Ridge property is located within a lobe of Upper Triassic
to Middle Jurassic strata exposed along the western edge of the
Bowser Basin within the Stikinia Terrane of the Intermontane Belt.
Stikinia formed in the Pacific Ocean during Carboniferous to Early
Jurassic (320 Ma to 190 Ma) and collided with North America
during the Middle Jurassic (Folk and Makepeace, 2007).
The
Project occurs within the metallogenic region known as the Stewart
Complex (Grove 1986, Aldrick, 1993). Described as the contact of
the eastern Coast Plutonic Complex with the west-central margin of
the successor Bowser Basin, the Stewart Complex ranges from Middle
Triassic to Quaternary in age and is comprised of sedimentary,
volcanic, and metamorphic rocks (Grove, 1986). The Stewart Complex
is one of the largest volcanic arc terranes in the Canadian
Cordilleran. It forms a northwest-trending belt extending from the
Iskut River in the north and Alice Arm in the south. The Coast
Plutonic Complex forms the western boundary of the prospective
stratigraphy; continental derived sediments of the Bowser Lake
Group form the eastern border. The Stewart Complex is host to more
than 200 mineral occurrences including the historic gold mines
Eskay Creek, Silbak-Premier and SNIP, as well as the Granduc,
Anyox, and Dolly Varden-Torbrit base-metal and silver mines. The
dominant mineral occurrences are precious metal vein type, with
related skarn, porphyry, and massive sulphide occurrences (Knight
and Macdonald, 2010).
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Stikinia,
which contains both the Stewart Complex and the Homestake Ridge
property, is comprised of at least four Paleozoic to Cenozoic
tectonostratigraphic packages (Kasper and Metcalfe, 2004)
including: Paleozoic Stikine Assemblage consisting of quartz-rich
rocks, carbonate slope deposits, and minor mafic to felsic volcanic
rocks; Early Mesozoic volcanic and inter-arc and back-arc basin
sedimentary rocks; Middle to Upper Jurassic Bowser Basin turbiditic
sedimentary rocks; and Tertiary post-kinematic granitoid intrusions
of the Coast Plutonic Complex.
Magmatic
episodes of Stikinia alternated with the development of sedimentary
basins. These basins formed during the Late Triassic to Early
Jurassic, the Toarcian to Bajocian (183 to 168 Ma) and the
Bathonian to Oxfordian (168 Ma to157 Ma) ages. The basin which
formed during the Toarcian-Bajocian is of considerable importance
because this west-facing, north-trending back arc basin contains
the Eskay Creek “contact zone” rocks (Hazelton Group),
which are overlain by Middle and Upper Jurassic marine basin
sediments (Bowser Lake Group).
least two periods of deformation occurred in the region, a
contractional deformation during the post-Norian-pre-Hettangian
(204 Ma to 197 Ma) and an Early Jurassic hiatus. These periods of
deformation are represented by unconformities one of which also
separates two metalliferous events that took place in the Early
Jurassic (e.g., Silbak-Premier and SNIP) and Middle Jurassic (e.g.,
Eskay Creek). Regional geology is shown in Figure 7.1.
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7.2
Local Geology
This
section is derived from Kasper and Metcalfe (2004) and Knight and
Macdonald (2010).
The
Stuhini Group rocks are found in the cores of anticlines and
represent the oldest known rocks in the area. These rocks are
composed of a thick sequence of volcanic and sedimentary rocks of
Upper Triassic (Norian) age, interpreted as the products of a
volcanic arc. The volcanic Stuhini Group rocks are generally
pyroxene-bearing, a contrast to the well-defined early crystallized
hornblende phenocrysts commonly found in the Lower Jurassic
Hazelton Group volcanic rocks. Kasper and Metcalfe noted that the
re-evaluation of bedrock mapping in the Homestake Ridge area in
2002 resulted in the assignation of some lithologies on the
property to the Stuhini Group.
The
Hazelton Group overlies the Stuhini Group. The Lower Jurassic
Hazelton Group is represented by a lower unit comprising massive,
hornblende+feldspar-phyric andesitic to latitic ignimbrites, flows,
and associated volcanic sedimentary rocks. Overlying these
intermediate volcanic rocks is the Lower-Middle Jurassic Eskay
Creek stratigraphy composed of marine felsic volcanic rocks and
associated epiclastic sedimentary rocks and fossiliferous clastic
sedimentary rocks. Kasper and Metcalfe noted that rocks of similar
lithology and stratigraphic relationship have been identified in
the Homestake Ridge area.
The
dominant local intrusive rocks are of Cretaceous to Eocene age
associated with the Coast Plutonic Complex. However, intrusive
rocks identified in the Homestake Ridge area are
hornblende+feldspar phyric and resemble Early Jurassic Texas Creek
Suite rocks, which are related to important mineralization
elsewhere in the Stewart Complex.
local deposits include the Dolly Varden-Torbrit Silver camp located
ten kilometres south of the Homestake Ridge property, which
produced 19.9 million oz Ag and 11 million lb Pb, and various
properties in the Stewart area such as Red Mountain, Granduc,
Silbak- Premier, and Brucejack Lake. Some of the mineralization on
the Homestake Ridge property is thought to be similar in age and
genesis to the VMS deposit at Eskay Creek, located about 115 km to
the north-northwest. Figure 7.2
illustrates the Local Geology.
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Source:
BC Energy and Mines Petroleum Resources, 2005
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7.3
Property Geology
section is derived from Kasper and Metcalfe (2004), Knight and
Macdonald (2010), and the results of mapping on the property by
Auryn over the last several years (Figure
7.3).
The
Property covers the transition between the sedimentary and volcanic
rocks of the Upper Triassic to Lower Jurassic Stuhini Group, a
complex sequence of Lower to Middle Jurassic sedimentary, volcanic,
and intrusive rocks of the Hazelton Group and sedimentary rocks of
the Upper to Middle Jurassic Bowser Lake Group. The Hazelton Group
rocks on the Homestake property mark a transition from a
high-energy volcanic dominated lower stratigraphy through a hiatus
and into a fining sequence of volcanic tuffs and sediments
punctuated by bi-modal mafic and felsic volcanism and finally into
fine clastic sedimentation of the Salmon River Formation (Upper
Hazelton Stratigraphy) and the Bowser Lake Group (Evans and
Lehtinen, 2001). This sequence hosts many sulphide occurrences and
extensive areas of alteration on the property which are associated
with the Lower to Middle Jurassic stratigraphy.
Interpretation
of the geophysical data paired with field mapping define the
boundaries and internal stratigraphy of 4 northwest-trending
domains numbered from SW to NE.
Domain
1 comprises Triassic sedimentary and volcaniclastic Stuhini Group
rocks, underlie the southwest portion of the property. Intruded and
silicified by sills and dikes of rhyolite/porphyritic monzonite.
Posses a low relative magnetic signature. A second unit of
relatively low magnetic signature which occupies the footwall of
the Vanguard fault and a second fault panel in Domain 1 are
pervasively altered Early Jurassic andesitic volcanic and
volcaniclastic Hazelton Group rocks (V2UN) these are intruded along
strike by similar sills and plugs of hornblende
monzonite.
Early
Jurassic Hazelton Group Betty Creek andesite, dacite and Brucejack
Lake member (192 Ma) rhyolite/monzonite, comprise Domain 2. The
western margin of Domain 2 is overthrust by the Triassic/Jurassic
package of Domain 1 and is unconformably overlain by Middle
Jurassic Salmon River sediments northwest of the Vanquard
showing.
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Source:
Auryn
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Early
to earliest Mid-Jurassic Hazelton Group volcanic and volcaniclastic
rocks of Betty Creek and Salmon River Bruce Glacier member (~174
Ma) comprise the central Domain 3, a northwest-trending package of
varied- and strong magnetic signatures which locally depict south
trending fabrics related to south-plunging folds and faults and
younger southeasterly trending thrusting. The Lower Hazelton rocks
comprise fine-grained to feldspar-hornblende phyric volcanic and
volcaniclastic rocks of andesite to latite/trachyte composition and
may include some phases of hypabyssal monzonite. This lower
stratigraphy of the Hazelton extends along the length of the
Homestake Ridge from the Main Homestake to the Vanguard Copper
showings and is the host rock and footwall sequences to the three
known mineral deposits, the Main Homestake, Homestake Silver and
South Reef zones, as well as numerous other showings. Porphyritic
monzonite dykes and hypabyssal domes intrude the Stuhini sediments
and are believed to be coeval with the Lower Hazelton volcanic
rocks. Greig et al. (1994) has related the Lower Hazelton Group
feldspar-hornblende porphyry volcanic package to the Goldslide
Intrusions at Red Mountain.
Thin,
locally discontinuous units of matrix supported, feldspar-phyric
volcanic breccias and heterolithic debris flow with tuffaceous and
mudstone to sandstone interbeds cap the lower volcanic stratigraphy
and are in turn unconformably overlain by maroon to green andesitic
and dacitic volcaniclastic rocks and tuffs which form much of the
central part of the Homestake Ridge property. These polylithic
andesitic and dacitic pyroclastic to epiclastic rocks contain
discrete mafic flows, tuffaceous beds, and debris flows. This
andesitic volcanic package has been equated to the Betty Creek
Formation (Evans and Macdonald, 2003).
The
southwestern bounding structure to domain 3 is a southwest-verging
thrust fault that occupies the north side of the Homestake glacier
with hornblende monzonite (I2F) either in the immediate hanging
wall or footwall of the fault.
Middle
Jurassic Salmon River/Quock Formation and overlying Bowser Lake
Group sedimentary rocks comprise Domain 4, covering the
northeastern portion of the Property. Pyritic horizons within the
Salmon River Formation define strong chargeability anomalies which
parallel stratigraphy. These fine grained carbonaceous and
sulphidic horizons are economic targets and are prone to localize
slip and shear zones. North-northwest and northeast- trending dikes
crosscut the Bowser Lake sediments.
The
Salmon River sediments form a band of rock which unconformably
overlie the volcanic flows and conglomerates of the underlying
stratigraphy from the toe of the Kitsault Glacier southeast along
the margins of Homestake Creek on the eastern side of the property.
A tongue of these sediments infills a basin which formed to the
southeast of the Homestake Silver Deposit. The fining-up nature of
this unit reflects the general fining up nature of the Salmon River
Formation as it progresses into the Bowser basin, and reflects the
development of a large-scale basin at the end of Hazelton volcanism
(Evans and Lehtinen, 2001).
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In the
northern part of the property at the headwaters of Homestake Creek,
rhyolitic volcanic rocks occur at the base of the Salmon River
sediments. Greig et al. (1994) mapped this unit and suggested a
correlation with the Mount Dilworth Formation of the Eskay Creek
area. The rhyolites are light to dark grey, massive and vary from
aphanitic to fine grained feldspar porphyritic banded flows to
tuffs and breccias. Pyrite is ubiquitous throughout, occurring
either as fine dissemination or infilling fractures and joints. A
series of Mafic Dykes with chilled margins and an elevated Niobium
signature were encountered intruding the Hazelton Group Rocks in
the Homestake Silver Zone. Similar dykes have been mapped at
surface intruding the Lower Hazelton Stratigraphy. These dykes are
of unknown age.
The
eastern part of the property is dominated by grey, interbedded
siltstones and sandstones thought to be part of the Middle to Upper
Jurassic Bowser Basin Group which conformably overlie the thin
bedded graphitic argillites of the Salmon River
formation.
Structure
on the property largely reflects NE-SW compression that has
continued from the Jurassic to present day (Folk and Makepeace,
2007), recent drilling and mapping suggest that the local
stratigraphy has undergone several deformation events including
uplift and local extension of the Stuhini and lower Hazelton
stratigraphy resulting in a marked unconformity between the lower
and upper Hazelton rocks.
In
general, the structural development is reflected by the magnetic
signature of strata in Domain 3 (andesites, +/- pyroxene
basalts, rhyolite, dacite). The NW-SE fabric (lithology/folds)
results from primarily north-trending folding and thrusting. This
fabric is crosscut by North and North-east striking faults and
dykes.
These
compressional tectonics have resulted in an antiformal (or horsted)
block of Triassic and lower Jurassic stratigraphy in the western
side of the property and a synformal (graben like) block of middle
to upper Jurassic rocks on the eastern side of the property. In the
southeastern part of the property, these two regimes are separated
by a northwest-striking, westerly dipping structure known as the
Vanguard fault. The Vanguard fault is a northwest-trending, ~60o
southwest dipping northeast verging structure characterized by up
to 50 m of variably sheared QSP altered rock.
Uplift
and local extension of the lower stratigraphy may have occurred
during the same Early Jurassic compressional event. The earliest
period of movement along the Vanguard fault may have occurred at
this time.
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Northwest-southeast
oriented normal faults occur along the northeastern slopes of
Homestake Ridge and locally represent the southwestern wall of the
“Hazelton Basin”. These faults would have been active
from the Early to Middle Jurassic as pyroclastic and volcanic flows
of the PC unit infilled the basin. Mineralizing fluids which lead
to the deposition of the gold and silver deposits on the Project
are thought to have been channelled along these faults.
Northeast-southwest faults offset the Hazelton Group volcanic and
older sedimentary rocks throughout the property. Younger Tertiary
extensional faults may have been superimposed on these
faults.
Large
northeast trending ankerite bearing faults have been mapped and
related to Tertiary east-west extension (Evans and Lehtinen,
2001).
7.4
Mineralization
main zones of the Homestake Ridge deposit are the Homestake Main
(HM), Homestake Silver (HS), and Silver Reef (SR). The HM is the
more copper-rich of the zones, with both gold-rich and silver-rich
variants and an apparent trend of increasing copper grade with
depth. The Homestake Silver zone is primarily silver with elevated
lead values, and South Reef is essentially high-grade gold, with
minor copper and lead. Their locations are shown on Figure 7.4 below and a long section is shown on
Figure 7.5.
The
Homestake deposits are commonly vertically zoned from a base metal
poor Au-Ag-rich top to an Ag-rich base metal zone over a vertical
range of 250 m to 350 m. The silver-galena-sphalerite veins of the
Homestake Silver Zone exhibit many of these features.
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Source:
Auryn
Locations
Source:
Auryn
Through the Homestake Ridge Deposit Looking
North-East
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7.4.1
Homestake
Main Deposit
The
Homestake Main deposit consists of a series of silica to
silica-carbonate-chlorite altered lenses and hydrothermal breccias,
which have a northwest strike and dip moderately northeast at
slightly steeper than the topographic dip-slope. Gold and silver
mineralization occurs with pyrite, chalcopyrite, and lesser galena
and sphalerite in stronger areas of silica alteration or
hydrothermal brecciation within zones of sericite-pyrite altered
feldspar-hornblende phyric volcanic rocks. Only along the
southwestern flank of the Homestake Main deposit does lower grade
gold mineralization penetrate up into the overlying package of
basinal filling volcano-sedimentary and andesitic rocks which
comprise the “hanging wall” sequence. Native gold along
with pyrargyrite and acanthite have been observed hosted within
quartz veins and quartz-carbonate hydrothermal breccias in drill
core.
The
Homestake Main deposit as currently known is about 700 m long and
has been traced down-dip by drilling for a distance of
approximately 500 m. At the surface, the northwestern extent of the
mineralization is obscured by a glacier; while to the southeast
surface geochemistry indicates that the zone continues towards the
Homestake Silver deposit 700 m to the southeast. Widths of the
Homestake Main Zone vary up to about 60 m (approximate true width)
and are defined by assay grades due to the diffuse nature of the
mineralization.
Grades
for gold typically range from 0.1 g/t Au to 2 g/t Au with some
intercepts measuring into the hundreds of grams per tonne and
averaged at 7.75 g/t Au. Silver grades are generally in the 1.0 g/t
Ag to 100 g/t Ag range but can be as high as hundreds and even
thousands of grams per tonne. The average silver grade in the HM is
68.6 g/t Ag. Copper grades vary from parts per million to several
percent, with mean grades observed to increase significantly with
depth.
Gold
distribution appears to be inhomogeneous and grades display a great
deal of local variability. The zone has a complex form which may
consist of a faulted series of lenses and related steeply dipping
feeders.
7.4.2
Homestake
Silver Deposit
Located
300 m to the southeast of the Homestake Main zone, the Homestake
Silver deposit is comprised of a series of northwest trending,
vertically to sub-vertically dipping hydrothermal breccias.
Mineralization occurs as galena, sphalerite and silver in contrast
to the gold enriched chalcopyrite seen the Homestake Main deposit.
Modelling indicates that the Homestake Silver deposit can be traced
over 700 m strike and 550 m down dip.
The
Homestake Silver zone comprises a cluster of parallel structurally
controlled zones, striking approximately 140° with
near-vertical dips. The individual sub-zones in the Homestake
Silver zone are narrower than the Homestake Main zones on average,
with true thickness rarely exciding three metres. The Homestake
Silver zone has been traced by drilling for a total vertical extent
of approximately 600 m, along a strike length measuring just under
800 m.
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Silver
grades at Homestake Silver average 154 g/t Ag, approximately double
that of the HM (68.6 g/t Ag) and 26 times that of SR (5.8
g/t Ag). Gold grades at Homestake Silver typically range up to
several g/t Au and averaged 3.5 g/t Au in the samples contained
within the interpreted zone boundaries. Copper content is
comparatively low, however, geochemically significant, and
generally measures between 10 ppm Cu and 500 ppm Cu. There are
elevated levels of lead and zinc, typically measuring in the 10 ppm
to 1,000 ppm range, with some intercepts assaying as high as
several percent lead and/or zinc. The lead and zinc grades at
Homestake Silver are not expected to be consistently high to
contribute significantly to the Project economics, although lead
grades were estimated in the block model to facilitate
metallurgical classification.
7.4.3
South
Reef Zone
The
South Reef deposit is located approximately 800 m to the
south-southwest of the Homestake Silver deposit. Gold
mineralization is variably associated with strong quartz-chlorite
alteration, pyrite and minor base metal sulphides interspersed with
intervals of sericite and pyrite alteration in two en-echelon,
northwest-trending sub-vertical mineral zones that can be traced
with drilling for over 250 m strike-length and 250 m dip. Several
base-metal enriched intercepts are identified up-section from the
gold-enriched zone but have yet to be fully defined by
drilling.
The
South Reef zone is comprised of two narrow sub-parallel tabular
bodies which strike at approximately 120° to 130° and dip
70°NE to 80°NE. To date, only twelve holes have
intersected significant mineralization, as such characterization of
the structure and grades is preliminary. The zones measure one
metre to three metres in thickness and have been traced for
approximately 300 m vertically and 400 m along strike. Silver
grades at South Reef average 5.8 g/t Ag in the vein samples. This
is offset by high gold values, which average 5.9 g/t
Au.
All
three zones have elevated arsenic and antimony contents, typically
averaging in the tens to low hundreds of parts per
million.
7.5
Prospects/Exploration Targets
other mineral occurrences of interest are present on the project
site. The significant mineral occurrences are described in the
following sections. Locations are shown on Figure 7.6 None of the exploration targets have
NI43-101 complaint Mineral Resources.
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Source:
Auryn
Targets
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7.5.1
Vanguard
Cu and Au Zones
Located
approximately 2.5 km southeast of the Homestake Zone, the Vanguard
is an 1,800 m long, 150 m wide structural zone hosted in various
pyroclastic and volcanic rocks. This area has undergone extensive
exploration including 36 trenches and short adits. Most showings
are located within a northwest striking, sub-vertically dipping
zone containing diffuse sulphide veins, stockworks, sulphide
breccia zones, and calcite-barite veins related to pervasive
chlorite alteration. Gold-enriched mineralization occurs in the
northern part of this belt and adjacent to and up-section from the
South Reef gold zone. To the south, the mineralization is
characterized by high grade copper with gold and silver (Folk and
Makepeace, 2007).
Homestake
drilled 13 holes in this area for a total 3,286 m aggregate
depth.
7.5.2
Sericite
Zone (Gold Reef, Fox Reef)
Located
in a large area southwest of the Homestake Zone, the Sericite Zone
comprises over 50 mineral occurrences hosted within
pervasively sericite-pyrite altered FHP intrusives and volcanic
rocks. These occurrences bear the historic names of Tip Top,
Foxreef, Goldreef, Matilda, Silver Tip, among others. Gold is found
in quartz-calcite-barite veins up to six metres wide with
pyrite+chalcopyrite+galena+sphalerite mineralization. Geochemical
surveys show an anomalous north-south trend along the volcanic-FHP
contact (Folk and Makepeace, 2007).
Homestake
drilled 15 holes along the Goldreef – Foxreef trend for a
total of 3,630 m aggregate depth.
7.5.3
Dilly
and Dilly West Zones
Historic
zones named Cascade Falls, Lucky Strike, Silver Crown, and Camp
Zone are collectively known as Dilly and Dilly West and occur
southwest of the Homestake zones.
Exploration
has been active in this area with over 40 pits, trenches, and adits
excavated. The zones are hosted by silicified mudstones and
siltstones overlying rhyolites. Mineralization consists of
syngenetic sulphide bands anomalous in Au, Ag, As, Bi, Pb, Zn, Hg,
and Sb. The zones are stratiform and display a linear trend with
strike lengths of 1,500 m for the Dilly Zone and 600 m for the
Dilly West Zone. The underlying rhyolite is cross-cut by veins with
similar mineralization to the sulphide bands and these veins are
interpreted to be “feeders”. Stratigraphically above
the sediments is a thin, silicified and mineralized rhyolite
pyroclastic. Silica decrease on the north end of the Dilly Zone,
and base metals and barite occur within the sediments. Also present
is semi-massive to massive arsenopyrite within sulphide stockwork
and FHP sills (Folk and Makepeace, 2007).
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7.5.4
North
Homestake Zone (North Dome)
The
North Homestake Zone is described as a large sericite-pyrite-silica
altered felsic dome approximately 3.2 km north of the Homestake
Silver deposit and occupies a 125 ha area. The geology is massive
feldspar-phyric, fine grained felsic volcanic rock of dacite to
latite composition that occurs in the upper part of the
volcano-sedimentary stratigraphy. Sheeted northeast trending
pyritic fractures occur in the strongly silicified southern and
western margins. These fractures are strongly anomalous in
pathfinder elements such as As, Sb, and Hg.
The
upper contact of the rhyolite is projected to be in contact with
sediments that are thought to be analogous to those at Eskay Creek.
The Kitsault Glacier, however, partially obscures the projected
two-kilometre contact. Previous drilling of this horizon by
Homestake in 2009 to 2010 intersected thick intervals of altered
felsic rocks and strong silver enrichment over tens of metres in
two holes. An attempt was made in 2002 by Teck to drill test this
geological target, but the hole was abandoned.
7.5.5
KNHSR1
The
KNHSR1 target lies directly south of the Dolly Varden silver
deposit. Historic sampling from the Silver King Min File
occurrence has returned up to 34.28 g/t Au and 576 g/t Ag as well
as 2.9 percent lead.
Work by
Auryn at the KNHSR1 target confirmed the presence of significant
base and precious metal mineralization with peak assays of 1.35 g/t
Au, 62.1 g/t Ag, 1.66 percent Cu and 20.3 percent Zn from boulders
and outcrop at the Silver King occurrence. The VTEM airborne
geophysical survey highlighted a major NW-SE trending structure
that coincided with the anomalous drainage basin identified in
2018. Follow up of the magnetics and stream sediment anomaly with
soils and rock sampling identified a coherent gold + silver soil
anomaly centered around the Silver King occurrence. The highly
anomalous base and precious metals assays paired with strong quartz
sericite alteration throughout the claim indicate that additional
exploration is warranted at KNHSR1.
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7.5.6
Kombi
The
Kombi target lies along a north – south oriented shear zone
evidenced from field mapping of silicified shears as well as linear
breaks in the magnetics picture. Stream sediment samples
collected from the area returned up to 910 ppb Au as well as
anomalous silver, lead and copper.
Recent
work by Auryn at Kombi has resulted in soil sampling up to 1.050
g/t Au paired with rock samples from quartz carbonate veining
returning 6.3 g/t Au and 1.37 g/t Ag. The 2019 interpretation
of historic airborne geophysics in the area outlined a NW trending
block of fault bounded volcanics associated with the highly
anomalous geochemical results.
7.5.7
Bria
The
Bria target includes the Banded Mountain Min File occurrence and
represents a potential Eocene Porphyry target. Stream
sediment sampling in the target area has returned anomalous silver,
lead, zinc and copper. Rock samples from the area have
returned up to 11.05 g/t Au and 448 g/t Ag all from quartz veins
hosted within intrusive rocks.
The
2019 VTEM survey over Bria highlighted a 3,000 x 500 m steeply
dipping intrusive body within sedimentary rocks.
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8. DEPOSIT TYPES
The
following section is derived from Folk and Makepeace (2007) and
Bryson (2007) and is taken from Macdonald and Rennie
(2016).
The
Project lies within the highly prolific Iskut-Stewart-Kitsault Belt
that is host to several precious and base metal mineral deposits.
Homestake Ridge has over 80 mineral occurrences on the Property
related in the emplacement of intrusive stocks and felsic domes
into the volcanic-sedimentary host rocks.
Diverse
mineralization styles on the property include stratabound sulphide
zones, stratabound silica-rich zones, sulphide veins, and
disseminated or stockwork sulphides. Mineralization is related to
Early Jurassic feldspar-hornblende-phyric sub-volcanic intrusions
and felsic volcanism and commonly occurs with zones of
pyrite-sericite alteration. A later, less significant, mineralizing
event occurred in the Tertiary and is characterized by
ankerite-calcitepyrite veins. Numerous models can be proposed for
the area and local deposits present a broad range of
characteristics.
Mineralization
displays characteristics of both epithermal gold and VMS
deposition. Stratabound and vein (or replacement) mineralization is
present that contains values in Ag, As, Au, Cu, Hg, Pb, Sb and Zn
(Folk and Makepeace, 2007). The property geology is considered to
be favourable for the discovery of “Subaqueous Hot Spring
Au-Ag” or “Low Sulphidation Epithermal Au-Ag”
type deposits.
The
“Subaqueous Hot Spring Au-Ag” deposits, of which Eskay
Creek is an example, are formed by “hot spring” fluids
venting into a shallow water environment. These deposits may
contain large, textureless massive sulphide pods, finely laminated,
stratiform sulphide layers and lenses, reworked clastic sulphide
sedimentary beds, and epithermal style vuggy breccia veins with
coarse sulphides and chalcedonic silica. As such, they share
characteristics of both VMS and epithermal deposits.
“Low
Sulphidation Epithermal Au-Ag” deposits, of which
Silbak-Premier is an example, are typically emplaced within a
restricted stratigraphic interval with one kilometre of the
paleosurface. Mineralization near surface takes place in hot spring
systems with deeper, underlying hydrothermal conduits. Typically,
mineralized zones are localized in structures but may occur in
permeable lithologies. Veins may exhibit open-space filling,
symmetrical and other layering, crustification, comb structure,
colloform banding, and multiple brecciations.
Deposits
are commonly vertically zoned from a base metal poor Au-Ag-rich top
to an Ag-rich base metal zone over a vertical range of 250 m to 350
m. The silver-galena-sphalerite veins of the Homestake Silver Zone
exhibit many of these features.
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9. EXPLORATION
Since
acquiring the Homestake Ridge Project in late 2016 Auryn has
completed extensive exploration across the property to advance
additional targets to the drill ready stage. This work has included
geological mapping, rock and soil geochemical sampling, portable
X-Ray fluorescence and shortwave infrared surveys, geophysical (IP)
surveying, the re-logging of historical drill core,
geochronological studies and airborne VTEM geophysical surveys
along with reprocessing of historic geophysical survey
data.
During the rock and soil sampling programs, Auryn obtained
representative samples of mineralization on the property. There are
no known factors that may have resulted in sample
bias.
9.1 Rock
Sampling
A total of 274 rock samples (channel, chip and grab) were collected
from the central Homestake claim block during the 2017 and 2019
programs.
A large proportion of the 2017 rock samples collected were located
along ridges with gossanous outcrop, targeting a potential northern
extension of the Homestake Main deposit. Additional samples were
collected around historic mineral occurrences near the Homestake
Main and South Reef Zones.
The majority of the 2019 rock samples were collected in a grid
fashion at the Kombi target where recent recession of glaciers
exposed large tracts of rock without soil developed or deposited on
top.
9.1.1. Rock Sampling
Methodology
Rock samples were generally selected based on favorable lithology
and mineralization. Samples were collected using a hammer and
placed in a poly ore bag with the sample number written on both
sides in permanent marker. A sample tag marked with the unique
sample number was placed inside each sample bag and sealed with a
cable tie. The geological information and location were entered
into an ArcGIS based application via Apple iPad
devices.
All the rock sample bags are packaged in double bagged
20” x 40” polywoven rice bags (for added
protection), labelled with the laboratory address, shipment number,
bag number and shipper details. Prior to sealing the rice bags, a
sample submittal form is be placed within the first bag of the
sample shipment. The rice bags are sealed with security tags, which
are scanned for the corresponding bag.
Completed sample shipments were slung with the helicopter to the
staging area where Rugged Edge Holdings Ltd. (expeditor) picked up,
transported the samples to their warehouse in Smithers, BC and then
arranged for ground transportation via Bandstra Transportation
Systems Ltd. to the ALS Global Laboratory in Vancouver,
BC.
9.1.2. Rock
Sampling Results
Highly
anomalous results in gold, silver and base metals were returned
from all areas of the property. Notably from Kombi, a sample of
quartz veined rhyolite with trace pyrite returned 0.22 g/t Au
with 4.11 g/t Ag. From the Bria target area a sample collected from
a quartz carbonate vein returned 6.3 g/t Au with 1.37 g/t Ag.
Sampling at the KNHSR target returned up to 1.35 g/t Au,
62.1 g/t Ag, 1.66% Cu and 20.3% Zn from a sulphide bearing quartz
carbonate vein.
9.2 Soil
Sampling
Soil
sampling was completed in order to expand upon historic soil
coverage as well as to ensure a consistent medium was sampled for
levelling purposes. Homestake mineralization trends to the
southeast and projects to an area covered by younger Salmon River
sediments. It is postulated that the block of sediments are
preserved due to a down-drop block within a graben. The sediments
are estimated to be 50 to 100 m thick and it is anticipated that
the same structures that control HS Silver mineralization form the
boundaries of the graben.
To
detect mineralization below the Salmon River sediments, an ultra
trace geochemical analysis method was used on samples collected
from the Ah organic soil horizon.
Anomalous
Ah horizon soil samples suggest a northwestern extension to the
Homestake Silver Mineralized Zone. Additionally, anomalous Ah
horizon soil samples correlate well with the South Reef mineralized
zone and suggest a southeastern extension.
Anomalous
talus fines samples further suggest a northwestern extension to the
South Reef zone.
BC
horizon soil sample results follow a similar anomalous trend to the
Ah and talus samples, having a strong northwest-southeast
orientation in the vicinity of Homestake Main, Homestake Silver and
South Reef mineralization.
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Soil
sampling at regional targets, Bria, Kombi and KNHSR1 returned
highly anomalous values in precious and base metals which require
additional follow up work. BC soil samples at Bria and KNHSR target
areas returned peak values of 1.05 and 0.283 ppm Au respectively.
At KNHSR a coincident silver anomaly occurs with the gold anomaly
with a peak value of 13.8 ppm Ag. Anomalous silver values were also
returned from the southern portion of the Kombi soil grid with a
peak value of 5.7 ppm Ag. Spotty arsenic and molybdenum anomalies
are present at all three target areas.
9.3 Induced
Polarization Survey
During
2017 17.5 line km of Induced Polarization (IP) ground geophysical
surveying was completed using a pole-dipole array with 50 m
dipole spacing. The 2017 survey data was combined with the 2013 IP
data and depth slices from both the resistivity and chargeability
were used to create 3D inversion models. The 3D inversions were
used in conjunction with drill hole logging to reinterpret the
geological setting of the Homestake property and confirmed the
apparent extensional regime and graben geometry.
9.4 Re-log of
Historic Drill Core
The
relog program was designed to evaluate criteria not previously
captured as part of historic logging including identifying fluid
flow characteristics, mineralization, and fluid chemistry
evaluation through short wave infrared (“SWIR”)
analysis. This data was then used to refine the geological model of
Homestake Main, Homestake Silver, the Slide Zone and South
Reef.
The
relog was very effective at identifying the variables which
correspond to mineralization. These included texturally destructive
strong silicification, high sulphide content, hematite and
hydrothermal chlorite, multiphase and single-phase hydrothermal
breccia, high crystallinity (both kaolinite and sericite), high
wavelength white mica minerals >2,208 nm, and Mg rich chlorite.
The correlation of faults and mineralization lead to the model of
down dropped blocks with fault bound lower contacts as conduits for
mineralization. It is possible the faults have been reactivated
causing the offsets seen in mineralization throughout the
deposit.
9.5
Geochronological Study
(5) geochronology samples were collected to help constrain the
crystallization age of intrusions and establish the age of a
rhyolite tuff (Hazelton or Salmon River) using
Uranium-Lead (U-Pb) Laser ablation techniques. Galena
Pb-isotopes were used to establish ages for mineralization within
mineralized veins. Ar-Ar step-heating techniques were utilized to
establish the cooling age of the intrusions (Table 9-1).
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Summary of Geochronology Results
Sample | | | | Method | |
17JLO-12 | Bravo | | | U-Pb | 55.62+/-0.65 |
17JLO-15 | Bravo | | | U/Pb | 43.64+/-0.42Ma |
17JLO-16 | Bravo | | | U/Pb | 196.5 |
17JLO-11 | Bravo | | | Ar-Ar | 57.3+/-1.10 |
W725899 | Bravo | | | Galena | Tertiary |
9.6
Airborne Geophysics
Versatile Time Domain Electromagnetic (VTEM) and Magnetics survey
was flown by Geotech Ltd. over two blocks of the Homestake Property
to augment the historic airborne geophysical data. The survey
comprised 574 line kilometres covering the Bravo N1-N7 (Area 1) and
KNHSR1 (Area 2) claims (Table 9-2).
Computational Geosciences Inc. was contracted to complete
interpretations and inversions of both the new survey data and the
historic data.
VTEM Survey Summary
Survey | Line | Line | Flight |
Area | Traverse: | 384 | N |
Tie: | N | ||
Area | Traverse: | 190 | N |
Tie: | N |
3D
inversions of the airborne electromagnetic and magnetic data were
completed from a variety of surveys (AeroTEM 2009, VTEM 2010, ZTEM
2012 and VTEM 2019) over the Property. Individual electrical
conductivity and magnetic susceptibility inversions were created
for each dataset and joint electrical conductivity inversions were
carried out for overlapping data regions.
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property scale magnetics picture highlights several regional
structures trending both NNE and NNW (Figure 9.1). The NNW trending structures are
interpreted to be the basin bounding faults which parallel
large-scale regional faulting. Conductive features identified from
the electromagnetics data have helped to refine the geometry of
several intrusive bodies throughout the Property, most notable at
Kombi where the mineralization identified to date is associated
with and hosted within intrusive rocks (Figure 9.2).
Magnetics
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Merged Conductivity
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10.
DRILLING
10.1
Historical Drilling
drilling on the Homestake Ridge property is summarized in Table 10-1. Collar locations are shown in
Figure 10.1, and representative
sections of drilling in HM, HS, and SR are shown in Figure 10.2.
Historical Drilling
Years | Company | Zones | | |
1964-1979 | Dwight | Lucky | 7 | 58.2 |
1989-1991 | Noranda | Homestake | 12 | 1,450.05 |
2000 | Teck | All | 21 | 4,374.6 |
2003-2012 | Bravo | All | 252 | 71,026 |
2013-2014 | Agnico | Exploration | 16 | 6,525 |
Source:
Auryn, 2020
10.2 Auryn
Resources Inc. Drilling
Following
acquisition of the Project, Auryn completed 13 drill holes totaling
5,571.3 m. RPA then prepared an updated Mineral Resource estimate
with an effective date of September 1, 2017; and a supporting
NI43-101 Technical Report dated September 29, 2017.
Auryn
completed a total of 37 drill holes totaling 14,850 m in 2017 on
the Homestake Main Zone (HM) and Homestake Silver Zone (HS) targets
and six drill holes totaling 2,482 m in 2018 on the South Reef Zone
(SR) target. Stream sediment sampling in 2019 led to the discovery
of the southern Kombi target area.
Drilling
was contracted to Cyr Drilling International Ltd. (Cyr) from
Winnipeg, MB. Cyr used helicopter portable A-5 hydraulic drills
manufactured by Zinex Mining Corp. to produce NQ2 (50.6 mm
diameter) core. The drills were moved between drill sites and
supported by an Astar 350 B-3 helicopter provided by Tseax Aviation
from Terrace, BC.
The
locations of drill hole pads were initially marked using a handheld
GPS instrument and the azimuth of the holes was established by
compass. Once the pad was built and the drill moved onto it, an
Azimuth Aligner instrument manufactured by Minnovare Pty. Ltd. was
used to establish the azimuth. An inclinometer was used to
establish the dip.
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The
attitude of the hole with depth was determined using a DeviShot
instrument manufactured by Devico AS in single shot mode with
readings taken by the drillers. The initial reading was taken at 6
m past the casing with subsequent readings taken nominally at 50 m
intervals. An Auryn geologist checked the core before making the
decision to terminate the holes. Upon completion of the hole, the
casings were pulled and the location of a hole marked with a
picket. Subsequently all hole locations were surveyed with
differential GPS.
Drill
core was placed sequentially in wooden core boxes at the drill by
the drillers. The core boxes were transported by helicopter on a
twice daily basis to the camp where depth markers and box numbers
were checked and the core was carefully reconstructed. The core was
logged geotechnically on a 3 m run by run basis including, core
recovery, RQD, and magnetic susceptibility.
The
core was descriptively logged and marked for sampling by Auryn
geologists paying particular attention to lithology, structure,
alteration, veining/brecciation, and sulphide
mineralization.
Readings
were taken at three metre intervals using a hand-held TerraSpec
Halo NIR spectrometer manufactured by ASD Inc.
Logging
and sampling information was entered into the GeoSpark core
software package supplied by GeoSpark Consulting Inc. (2017) and MX
Deposit cloud-based core logging application by MINALYTIX INC.
(2018) which allowed for the integration of the data into the
project acQuire database.
The
core was photographed both wet and dry after logging but prior to
sampling.
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Source:
Auryn
Locations
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Views
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11.
SAMPLE PREPARATION, ANALYSES, AND SECURITY
11.1
Historic Sampling
The
following is taken from Macdonald and Rennie (2016).
The
Project has been explored by numerous historic trenches and adits.
Auryn is not aware of any written procedures for sampling that
predates Homestake’s acquisition of the Project. However, as
the trenching and underground sampling were not used in the Mineral
Resource estimate, they are not discussed in detail in this
Technical Report.
On
acquiring the Project in 2003, Homestake conducted several
traverses to orient and ground truth existing database sites such
as drill collars and individual sampling locations. Homestake
concluded that Teck Resources’ (Teck) sampling was accurately
located, but discrepancies were found with respect to the Noranda
Exploration Company Limited (Noranda), Cambria Resources Ltd.
(Cambria), and Newmont Exploration of Canada Ltd. (Newmont)
sampling. Generally, previous operators’ sampling sites were
clearly marked with flagging, tags, and paint. Samples that could
not be verified in the field were dismissed.
11.2
Homestake Resources Corporation Sampling
The
following is taken from Macdonald and Rennie (2016).
Homestake
has conducted surface grab, chip, and soil sampling, plus diamond
drilling on the Project area. A total of 417 grab and chip samples
were taken from outcrops and old excavations. A total of 847 soil
samples were collected at 25 m to 50 m intervals along a series of
lines spaced from 100 m to 200 m apart in the 2004, 2011, and 2012
exploration programs. Soil samples were collected from the
B-horizon, where possible, and placed in Kraft paper
bags.
Rock
samples were placed in plastic sample bags with sample tags and
sealed with zip ties. Sample locations were marked with metal tags
and flagging tape. Samples were secured in a locked facility until
they were transported by a local freight to the assay laboratory.
The assay laboratories used are summarized in the subsequent
subsections.
Drill
core was delivered to the logging facility by helicopter where it
was inspected by the logging geologist and subjected to a quick
log. The quick log comprised of a brief description of lithology,
alteration, and mineralogy, as well as a description of any
significant structural characteristics. The core was photographed
and stored for future comprehensive logging.
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All
drill core was logged for lithology, mineralization, type and
intensity of alteration, vein mineralogy and component percentage,
breccia intensity, fracture intensity and structural components
such as faults, fractures, contacts, bedding, cleavage (primary and
secondary), and veining, measured relative to the core axis.
Geotechnical logging included recovery, RQD and, occasionally, bulk
density.
Sample
intervals, to a maximum length of three metres, were designated by
the logging geologist based on lithology, mineralogy, alteration,
and structure. Each sample was given an identifier from a
three-part tag system. The core was cut in half longitudinally
using a diamond saw, with half being sent for analysis and half
remaining as a permanent record. One part of the waterproof tag was
placed in the sample bag, one was placed with the remaining core at
the start of the sample interval, and the third tag remained in the
tag book as a reference. Unmarked standards and blanks were
included in the samples submitted, roughly once in every 20 samples
with a ratio of 2:1 standard to blank. Samples were secured in a
locked facility until they were transported by local freight to the
assay laboratory.
All of
the core was transported to Prince Rupert and placed in a storage
facility where it was reviewed periodically by Homestake
Geologists.
Homestake
took bulk density measurements of the core, using a water immersion
method. Intact core specimens were weighed in air, then on a pan
immersed in a bucket of water. The weight of displaced water was
determined by subtracting the wet weight of the sample from the dry
weight. The density is the ratio of the dry weight to the weight of
the water displaced by the specimen. A total of 7,330 bulk density
determinations had been collected to the end of the 2012
program.
In
RPA’s opinion, the core was transported, handled, and stored
in a safe and secure manner. Homestake’s sampling and logging
procedures are appropriate for the deposit type and style of
mineralization. The drill samples are representative of the
mineralization.
11.3
Assaying of Drill Core
11.3.1
2003 to 2006 Procedure
The
primary laboratory utilized for the 2003 to 2006 period was Acme
Analytical Laboratories Ltd. (Acme) of Vancouver, although Eco-Tech
Laboratories Ltd. (Eco-Tech) of Kamloops, BC was the primary
laboratory in 2003. Both companies are independent laboratories and
their accreditation during this time period is unknown. One
kilogram samples were crushed to 80 percent passing 10 mesh from
which a 250 g split was taken. This subsample was homogenized,
riffle split, and pulverized to 85 percent passing 150 mesh. A one
assay ton (AT) split was taken and subjected to fire assay (FA)
fusion with Inductively Coupled Plasma Atomic Emission Spectroscopy
(ICP-AES) analysis for gold and silver. Samples above 10 ppm Au or
200 ppm Ag were rerun using atomic absorption (AA) with gravimetric
finish. Base metals were also commonly run on over-limit samples
(Bryson, 2007).
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All
samples were analyzed by Inductively Coupled Plasma Mass
Spectrometry (ICP-MS) for 41 elements. A 0.25 g subsample was
digested in an acid solution of H2O-HF-HClO4-HNO3 (2:2:1:1) and 50
percent HCl was added to the residue and heated. After cooling, the
solutions were transferred to test-tubes and brought to volume
using dilute HCl and then assayed.
Metallic
analysis was done for over-limit samples during the 2005 to 2008
programs. Samples were crushed, pulverized, and a 500 g subsample
was extracted. The samples were sieved and the +200 and -200 mesh
fractions were collected and weighed. These fractions were assayed
by FA with gravimetric finish. The final grade was calculated from
a weighted average of the assays for the +200 and -200 mesh
fractions.
11.3.2
2007 to 2008 Procedure
Initially,
samples were sent to Acme, however, in order to address processing
delays, some samples were sent to International Plasma Labs Ltd.
(IPL) of Richmond, BC, an ISO 9001:2000 accredited facility. The
sample preparation consisted of:
■
Crushing samples to
approximately 80 percent passing 10 mesh and the entire charge was
reduced to 250 g by repeated splitting through a riffle
splitter.
■
Ground the 250 g
split using and Ring and Puck pulverizer until approximately 90
percent passes 150 mesh.
■
Rolling the split
to ensure homogeneous particle distribution and transferred to a
computer labelled sample bag.
A one
AT aliquot was assayed by FA with AA finish. Samples with gold
values greater than 1,000 ppb Au (over-limit) were re-assayed using
FA with gravimetric finish. In addition to the FA, each sample was
subjected to a 30 element analysis by (AR)/ICP with aqua regia
digestion.
11.3.3
2009 to 2012 Procedure
Acme
was the primary laboratory for the 2009 and 2010 programs. Sample
preparation procedures consisted of a one kilogram split being
crushed to 80 percent passing 10 mesh from which a 500 g split was
taken. This split was pulverized to 85 percent passing 150 mesh
(later 200 mesh). A one AT split was taken and subjected to FA
with Inductively Coupled Plasma Emission Spectroscopy (ICP-ES)
finish for gold and silver. The upper detection limit for this
method was 10 ppm Au and 200 ppm for Ag. Any determinations that
exceeded 10 ppm Au or 200 ppm Ag were rerun by AA with gravimetric
finish. Over-limit samples were also commonly run for base metals
using four-acid digestion and ICP-ES analysis. A 0.25 g split was
taken for all samples and run by ICP-MS after three-acid
(HNO3-HCl4-HF) digestion.
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In
RPA’s opinion, assaying was conducted using conventional
methods commonly used and accepted within the industry and
appropriate for the type of mineralization. The laboratories were
certified commercial facilities. A reasonable practical level of
sample security has been maintained throughout all of the drill
programs.
11.4
Agnico Eagle Mines Limited Sampling
The
following is taken from Swanton et al. (2013).
Half
core samples were collected using a gas-powered core saw onsite at
the site core shack. Samples were placed in sealed poly rock bags
and sent to the ALS Minerals (ALS) preparation facility in Terrace
for sampled preparation (crushing and pulverising). ALS re-directed
some sample shipments directly to Vancouver for sample preparation
depending on capacity at the Terrance facility. Geochemical
analyses were completed at the main ALS facility in Vancouver. ALS
is an accredited laboratory, recognized under accreditation No.
579, and conforms with requirements of CAN-P-1599, CAN-P-4E (ISOMEC
17025-20905)). Samples were analyzed for gold via fire assay
(method code Au-AA23) and a 48-element ICP package utilizing
four-acid, “near total” sample digestion (method code
ME-MS61). Sample lengths varies between 1.5 m and 0.5 m at the
prerogative of the logging geologist and a total of 3,658
(including quality assurance/quality control (QA/QC)) samples
taken. Samples of Certified Reference Materials (CRMs) or blanks
were inserted every ten samples on sample numbers ending in zero,
alternating between one of three CRMs (CDN-GS-2L, CDN-GS-13A and
CDN-CM-24) which were supplied by CDN Resource Laboratories Ltd
(CDN) of Vancouver, British Columbia. Blank material comprised of
gardening limestone acquired from a Canadian Tire retail outlet.
Similarly, a duplicate was inserted every ten samples, on sample
numbers ending in ‘5’. Half of the duplicates were
field duplicates, where the half of the split core which would
normally remain in the box was instead sampled. The other type of
duplicate was a preparation duplicate, in which an empty bag (with
sample tag) was inserted into the sample sequence and the
preparatory laboratory instructed to take a split of the material
after crushing and analyze it as the duplicate sample.
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ALS
prepared additional splits of the master pulps and returned them to
the Project site for analysis using a portable X-ray Fluorescence
(XRF) analyser rented from Innov-X Systems. A total 326 samples
were analyzed using both “Soil Mode” and “Mining
Plus Mode” – a procedure designed to detect both trace
and high concentration elements.
11.5
Auryn Sampling
Core
recovery is generally very good to excellent, allowing for
representative samples to be taken and accurate analyses to be
performed. Sawn core samples, two metres long, were taken along the
entire length of each hole. A total of 8,622 split core samples
were taken.
Individual
core samples were placed in rice bags which were sealed using
uniquely numbered zip ties and flown to the staging area on a twice
per week basis where they were immediately transferred to Rugged
Edge Holdings Ltd., acting as Auryn’s expeditor, for
transportation to Smithers. From Smithers, the samples were trucked
by Banstra Transportation System Inc. to the ALS sample preparation
facility in Terrace/Vancouver, BC.
Core
boxes from completed and sampled holes were flown by helicopter to
a staging site from where they were trucked to a secure sample
storage site in Prince Rupert, BC.
Figure 11.1 illustrates Auryn’s core handling flow
chart.
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Chart
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11-6
11.6
Laboratory Methods
In
Terrace/Vancouver, the samples are logged into ALS’s sample
tracking system, dried and fine crushed to better than 90 percent
passing 2 mm. The sample is then split using a riffle splitter and
a 250 g portion is pulverized to better than 85 percent passing 75
m (ALS Sample Preparation Code Prep-33D). The pulverized
samples were forwarded to ALS’s analytical facility in
Vancouver for analysis. ALS is an accredited laboratory, recognized
under accreditation No. 579, and conforms with requirements of
CAN-P-1599, CAN-P-4E (ISOMEC 17025-20905)). Auryn and RPA are
independent of ALS.
In
Vancouver, each sample was assayed for gold and analysed for a
multi-element suite. Gold was determined by fire assay on a 30 g
sample with an Atomic Absorption Spectroscopy (AAS) finish (ALS
Code Au-AA23). Samples assaying greater than 5 g/t Au were
re-assayed with a gravimetric finish (ALS Code Au-Grav21). One
kilogram of pulverized material from samples assaying greater than
20 g/t Au were re-assayed by screened metallics fire assay (ALS
Code Au-SCR21).
A
one-gram sample of pulverized material was analysed for a
48-element suite, including silver and copper, by ICP-MS after a
four-acid digestion (ALS Code ME-MS61). Samples yielding analyses
of silver greater than 100 ppm Ag were re-analyzed by HCl leach
with AAS finish after a three-acid digestion (ALS Code Ag-OG62).
Thirty grams of material yielding analyses of silver greater than
1,500 ppm Ag were fire assayed with a gravimetric finish (ALS Code
Ag-GRA21).
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Chart
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11-8
11.7
QC Sampling
Quality
Control (QC) samples were introduced into the sample stream at a
rate of 1 in 20 for both blank samples and CRM samples. Field
duplicates, in the form of quarter sawn samples, were introduced
into the sample stream at a rate of 1 in 50 samples.
blank material was acquired from Analytical Solutions. Four CRMs
were acquired from OREAS to cover a range of grades and elements
including gold, silver, and copper. Table
11-1 lists the CRMs and their respective expected
values.
Certified Reference Material
CRM | | ||
| | | |
OREAS | 2.47 | 4.87 | N/A |
OREAS | 12.11 | N/A | N/A |
OREAS | 0.20 | 24.75 | 482 |
OREAS | 5.18 | 284.34 | 1.00% |
All
holes were continuously sawn in two metre samples regardless of
geological contacts.
11.8
2017 to 2019 QC Programs
RPA
received QC reports for all 2017 to 2019 drilling. Auryn generated
a standard report exported from acQuire with the results of each
sample batch. Microsoft (MS) Excel files were provided summarizing
the results for all QC standards, blanks, and duplicates. RPA has
reviewed the reports and files, as well as the laboratory
procedures outlined in the RPA (2017) report and concludes that the
QC program for the 2017 to 2019 period is sufficient to support the
Mineral Resource estimate. In some instances, the Auryn standards
and duplicates did not perform as well as the laboratory control
samples. QC standards MP-1b and OREAS 932 demonstrated consistent
overestimation for the laboratory method Ag_OG62_ppm (an over-limit
method), however, these standards were not used in the 2017 drill
program since over-limit analysis did not occur. QC sample failures
were dealt with on a case by case basis and were documented with
commentary in the Dispatch Returns table within the acQuire
database. RPA recommends Auryn produce MS Word style reports on QC
sample performance for regular periods which describe the results
and those of the MS Excel files, summarize measures taken, outline
possible issues, and suggest any possible further improvements to
the process.
RPA
concurs with the adequacy of the samples taken, the security of the
shipping procedures, and the sample preparation and analytical
procedures at ALS. In RPA’s opinion, the QA/QC program as
designed and implemented by Auryn is adequate and the assay results
within the database are suitable for use in a Mineral Resource
estimate.
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12.
DATA VERIFICATION
12.1
Site Visit
Paul
Chamois, M.Sc. (A), P.Geo., Principal Geologist with RPA and an
independent QP, visited the Project from August 26 to 28, 2017.
During the visit, Mr. Chamois examined core from the on-going
drilling program, confirmed the local geological setting, reviewed
the core handling and data collection methodologies, and
investigated factors that may affect the Project. Due to the
advanced nature of the Project, no independent samples were taken
during the visit.
12.2
Historical Verification
Comprehensive
data verification was performed by RPA both for the 2010 and 2011
Mineral Resource estimates as outlined in supporting NI43-101
reports (Rennie et al. 2010, Rennie, 2011). These included checks
against original data sources, standard database checks such as
from/to errors, and basic visual checks for discrepancies with
respect to topography and drill hole deviations.
For the
2011 to 2012 data, Homestake and RPA conducted data validation
procedures similar in some respects to those carried out for
earlier drilling campaigns. The Mineral Resource database was
imported by Homestake into Gemcom SURPAC software for management
and manipulation of exploration and mining data. All samples and
tables in the database relevant to the Mineral Resource estimate
were audited using the database audit facility and no errors were
found. As a secondary check, RPA extracted 4,229 samples from the
2011 to 2012 drilling results, representing 14 percent of the total
samples in the database, and compared them to the original assay
certificates. No errors were found (Rennie, pers. comm.,
2013).
12.3
2017 to 2019 Verification Work
The
Project drill and sample database is currently maintained in
industry standard acQuire GIM software, which incorporates
validated log entry and assay certificate imports. RPA reviewed the
drill database provided in the Seequent’s Leapfrog Geo/EDGE
(v5.0.3) (Leapfrog) Mineral Resource project. Overall, the database
appears to be well-constructed with appropriate field names. Data
from previous owner campaigns are incorporated with
comments.
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Thirty-three
NULL sampleIDs with no grades were explained as unsampled intervals
in Auryn’s surface trenching. Minor work is still required to
find and enter 225 drill hole dates and correct older collar
positions which differ from topography (e.g., 1989 Noranda holes in
the Project deposit area re-surveyed by Homestake in 2008 using
differential GPS). These holes do not materially affect the Mineral
Resource estimate. RPA also recommends adding a “YEAR”
field to the collar table to easily query drilling
summaries.
12.4
Assay Verification
Auryn
provided RPA with 104 assay certificate CSV export files containing
14,201 gold, silver, and copper assays from 2017 to 2019 drilling.
Previous drilling has been covered by previous verification
exercises. Of this subset, 8,719 sample IDs matched with sample IDs
in the Mineral Resource database. For Au, Ag and Cu, RPA found 100
percent grade matches with no errors.
RPA is
of the opinion that database verification procedures for the
Project comply with industry standards and are adequate for the
purposes of Mineral Resource estimation.
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13.
MINERAL PROCESSING AND METALLURGICAL
TESTING
13.1
Overview
Historical
metallurgical testwork on Homestake Ridge mineralization is fully
documented in previous NI43-101 Technical Reports. The reader is
directed to the 2017 Technical Report by RPA for details on the
historical testwork.
The
following sections outline the results of the most recent
metallurgical testwork which is relevant to the proposed
metallurgical flowsheet for processing Homestake Ridge
mineralization. The reader is referred to Shouldice (2016) for
additional information.
13.2
Base Metal Laboratories 2016
The
process parameters adopted for this study were derived by Base
Metal Laboratories in a 2016 test program that focussed on a hybrid
of sulphide flotation and cyanide leaching to maximize the recovery
of precious metals. Duplicate head cuts were taken from each
composite and assayed for Au, Ag, Cu, Pb, Zn, and Fe. The Main
composite had a measured head feed of 4.62 g/t Au and 6
g/t Ag and represented the copper dominant part of the Main
deposit. The Silver composite had a measured head feed of 7.76 g/t
Au and 198 g/t Ag and was much higher in Ag, Pb and Zn than the
Main deposit.
The
following description of the 2016 testwork at Base Metals
Laboratory has been extracted from the 2017 RPA Technical
Report.
For the
Main zone, the process consisted of the sequential production of a
gravity concentrate, copper concentrate, and gold bearing pyrite
concentrate by flotation. The copper cleaner tailings and pyrite
concentrate were cyanide leached together to extract gold and
silver. For the Silver zone, the process was similar, however, the
copper flotation stage was replaced by sequential flotation of lead
and zinc concentrates. Tests were also conducted without gravity
concentration to measure the effect on metallurgical
performance.
The
primary grinding was conducted in a mild steel rod mill using mild
steel grinding charge. A 2 kg test charge was used for each
test. Similarly, all regrinding was conducted in a smaller mill
with stainless steel grinding charge.
Gravity
concentration was conducted using a Knelson gravity concentrator
with a 100 g bowl. The gravity concentrate was then panned to
reduce the mass recovery and increase the grade of the gravity
concentrate. The pan and Knelson tails were collected together and
excess water was decanted for the following flotation
stages.
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Flotation
was conducted with a Denver D12 flotation machine. Rougher
flotation was conducted in a 4.4 L cell and cleaner flotation was
conducted in 2.5 L and 1.5 L flotation cells. Very selective
reagent schemes were used in the base metal flotation stage to
increase the probability of producing marketable concentrates. For
copper flotation, NaCN was added to depress pyrite and a selective
collector was used (Cytec 3418A). The flotation pulp was modulated
to pH 9 to 9.5 with lime. For selective flotation of lead and zinc,
zinc sulphate and cyanide were used to depress sphalerite and
pyrite. Once complete, the pH was increased to 10 with lime and
copper sulphate was added to recover sphalerite. The use of Cytec
3418A was continued in the lead and zinc circuit to aid in pyrite
depression. Pyrite flotation was conducted with PAX.
All
leaching was conducted as 24-hour bottle roll tests at relatively
high cyanide dosage.
13.3
Ore Sorting
A 2012
investigation by Tomra Sorting Solutions evaluated the amenability
of Homestake Ridge mineralization to ore sorting. One hundred and
thirty-six samples were submitted from various locations at the
project site, and were subjected to:
■
Dual energy X-Ray
Transmission sorting (DEXRT)
■
Conductivity/magnetic
susceptibility sorting (EM)
■
Near infra-red
spectroscopy sorting (NIR)
■
Visible spectrum
optical sorting (Optical)
■
X-Ray Fluorescence
Spectroscopy sorting (XRF-S)
The
results showed that DEXRT sorting showed good promise with
recoveries approaching a perfect recovery curve at a 65 percent
mass pull containing 99 percent of the payable metal. The same
favorable results were also obtained on DEXRT sorting of
concentrates.
The
XRF-S showed some promise, especially with long exposure times.
However, as the exposure time is reduced the precision of the
sorting is greatly reduced.
The
samples did not show any upgrading with the EM, NIR or optical
sorting. These Homestake minerals do no appear to be amenable to
sorting with these technologies.
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13.4
Gravity Concentration
Gravity
concentration was performed after primary grinding. The entire
primary mill discharge was passed through a Knelson Concentrator
then the Knelson concentrate was panned to reduce the mass recovery
to more typical recovery values achieved in operating
plants.
The
Main composite recovered approximately 21 percent of the gold in
the feed into a concentrate grading 83 g/t Au. Further upgrading
would be required to make the concentrate marketable, which often
results in a further drop in recovery.
The
Silver composite showed more promise, gold in the feed was 28
percent recovered into a gravity concentrate grading approximately
249 g/Au, on average. At these grades and recoveries, the gravity
concentrate would have potential for sale.
13.5
Main Composite Rougher Flotation Testing
A total
of three rougher flotation tests were completed, on the Main
composite.
The
selective flotation conditions applied to recover copper to a
concentrate were mostly successful. Copper recoveries of between 85
percent and 90 percent can be achieved at rougher mass recoveries
of 6 percent to 10 percent. The moderate level of mass recovery
would indicate that process was somewhat selective against other
sulphides and the rougher concentrate should be amenable to
upgrading to high grade copper concentrates.
This
copper recovery was insensitive to primary grind size. To assess
gold metallurgical performance, the cumulative gold recovery of the
gravity, copper rougher, and pyrite concentrates were compared to
the total cumulative mass recoveries of these
concentrates.
For
either grind size, gold recovery was about 95 percent to
concentrates at 30 percent mass recovery.
Gold
recovery to concentrates did show some sensitivity at lower mass
recoveries. Better gold recoveries were achieved at the finer
primary grind size, with lower mass recovery. This is likely a
result of improved mineral liberation at the finer grind
size.
Similarly,
the silver metallurgical performance data indicates that at 30
percent mass recovery, silver was about 90 percent recovered into
concentrates. Marginally better silver recoveries were observed
with the finer primary grind size at lower mass
recoveries.
Finally,
the inclusion of a gravity circuit was investigated with respect to
overall gold recovery. The data was insensitive to gravity,
indicating that high gold recoveries could be achieved with
flotation alone.
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13.6
Silver Composite Rougher Flotation Testing
Three
rougher tests were performed on the Silver composite. Selective
flotation conditions were utilized to float sequential lead, zinc
then gold bearing pyrite concentrates.
Lead
recovery to the lead rougher concentrate reached a maximum of 80
percent. The rougher mass recovery to achieve this lead performance
ranged from 2 percent to 5 percent. There was considerable scatter
in the data making it difficult to determine if primary grind size
had an influence on lead metallurgical performance.
There
was a limited amount of testing to investigate zinc metallurgical
performance. Zinc was about 25 percent recovered to the lead
rougher concentrate and 60 percent recovered to the zinc rougher
concentrate. While it may still be possible to produce high grade
concentrates, further process development studies would be
required. The zinc concentrates were low grade and there was a high
deportment of gold and silver to the rougher concentrates. Payment
terms for gold and silver are not as favorable for zinc
concentrates, therefore zinc flotation was not developed further in
this program.
The
finer primary grind size had better initial gold recovery at low
concentrate mass recovery.
As the
concentrate mass recovery was increased to more than 20 percent,
however, there was little effect on gold recovery. Total gold
recovery to all concentrates was 95 percent at 20 percent mass
recovery.
The
effect of primary grind on silver was inconclusive. Overall total
silver recovery to all concentrates ranged between 90 percent and
95 percent at 20 percent mass recovery.
The
data indicates that omitting the gravity process will not reduce
gold recovery to concentrates.
13.7
Main Composite Cleaner Flotation Testing
Selective
flotation conditions were employed to suppress pyrite during copper
flotation by using a low dosage of cyanide (5 g/t) and a collector
selective against pyrite.
The
test results showed that copper in the feed was 70 percent
recovered into concentrates grading up to 28 percent copper. These
results were achieved in batch cleaner tests and improvements in
copper recovery would be expected during closed circuit
operation.
During
the testing, the regrind discharge size was relatively constant,
ranging between 21 lm and 25 lm K80. This size is relatively fine;
more testing would be required to fully optimize this
parameter.
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13-4
Tests
indicated that gold grade and recovery were reduced when gravity
was utilized, indicating that some of the gold was already captured
in the gravity concentrate.
Without
gravity in the circuit, gold recoveries of between 50 percent and
55 percent would be expected at final copper concentrate grades
that are marketable. The gold content at this recovery would be
between 300 g/t and 380 g/t.
Similarly,
including gravity concentration slightly reduced the recovery and
grade of silver reporting to the copper concentrate. Overall,
silver recovery to the final concentrate averaged 40 percent
to 45 percent at grades of between 550 g/t and 650
g/t.
The
batch cleaner tests clearly demonstrate that high grade copper
concentrates can be produced with selective flotation conditions.
Furthermore, the copper concentrate would be high value due to the
gold and silver content.
Parameter
optimization was limited and there is potential to improve the
metallurgical results or reduce the cost of the process with
additional optimization testing.
13.8
Silver Composite Cleaner Flotation Testing
The
batch cleaner testing for the Silver zone utilized selective
conditions to recover a lead concentrate. In lead flotation,
cyanide and zinc sulphate were used to depress pyrite and
sphalerite. In some of the tests, production of a zinc concentrate
was attempted after lead flotation. A gold bearing pyrite
concentrate was recovered after the flotation of the base metal
concentrates.
The
inclusion of gravity concentration into the process resulted in
poorer lead, gold, and silver grade and recovery performance.
Deportment of these metals to the gravity concentrate was the cause
of the poor flotation performance.
Without
gravity concentration included in the process, lead was about 65
percent recovered into a concentrate grading 30 percent lead. The
concentrate grade and recovery profiles were relatively flat
indicating potential to further improve lead concentrate
grade.
Only
two tests attempted to produce zinc concentrate. Low grade
concentrates were produced at about 45 percent zinc recovery. These
initial tests indicate that zinc concentrate production would be
unlikely using basic conditions. It may, however, still be feasible
to produce zinc concentrate with further testing and
development.
Tests
without gravity concentration demonstrated that gold in the feed
could be 66 percent to 68 percent recovered to the final lead
concentrate at gold grades of 800 g/t to 1,000 g/t.
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13-5
Silver
recovery to the lead concentrate demonstrated much more variability
than the other elements. Without gravity concentration, final
silver content in the concentrates ranged from 7,000 g/t to 12,000
g/t. Recovery of silver to the concentrate varied from 23 percent
to 50 percent to the final lead concentrate. The recalculated
silver head matches were highly variable and typically lower than
the measured head for this element. Due to the high measurement
values, it is possible concentrate grades were under-reported,
unfortunately there was insufficient concentrate mass to verify the
silver assays.
13.9
Cyanide Leaching of Flotation Products
To
maximize the gold and silver extraction from the project, the
pyrite concentrate and cleaner tailings streams were leached with
cyanide. The feed for each leach test was reground prior to
leaching. Previous testing indicated that relatively fine grind
sizes improved total extractions. Aggressive leach conditions were
applied, primarily to accelerate the leaching of silver, which
often has much slower leach kinetics than gold. Due to time
constraints for project completion, 24-hour leach tests were
performed. In retrospect, the kinetic rate curves for most of the
tests indicated that leach was incomplete, particularly for
silver.
For the
Main composite, leaching of the pyrite concentrate and copper
cleaner tailings without gravity indicated that extraction was 73
percent and 57 percent for gold and silver, respectively. The
silver composite demonstrated better leach performance. Indicated
gold and silver leach performances on concentrates without gravity
were on average 80 percent and 65 percent for gold and silver,
respectively.
Cyanide
consumption was typical of concentrate leaching, averaging about
4.4 kg/t of leach feed. Lime consumption averaged about 0.4 kg/t of
leach feed.
The
results achieved were relatively good, but there is considerable
scope for improving the performance. Finer regrind sizes should be
investigated along with leach additives like lead nitrate to
improve leach kinetics.
13.10
Concentrate Quality Estimates
Additional
assays on the final concentrates from each composite were performed
to determine levels of critical minor deleterious elements. The
analyses conducted were limited due to the amount of concentrate
available for testing. Most tests produced only 10 g to 15 g of
base metal concentrate, which was mostly consumed for gold, silver,
copper, lead, zinc, and iron.
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Arsenic,
antimony, and mercury are indicating high values that will likely
attract smelter penalties. Normally, some smelters may reject
concentrates on the basis of the high arsenic, antimony, and
mercury, however, due to the exceptionally high precious metal
values of these concentrates, the concentrates should be readily
marketable.
It is
strongly recommended that these initial minor element assays are
confirmed with additional assaying with element specific
techniques. Due to the unusually high grade of the concentrates,
advice on the concentrate marketing should also be sought from a
concentrate marketing specialist.
13.11
Comment on Metallurgical Sampling
authors are satisfied that the metallurgical sampling upon which
the above results are based are representative of the major styles
of mineralization hosted in the Homestake Ridge deposits
considering the grade variability, metals distribution, mineralogy
and degree of alteration. A long section showing the
metallurgical sampling locations in the Homestake Main and
Homestake Silver deposits is shown on Figure 13.1. Additional metallurgical
sampling and testing will be performed at the Feasibility
stage.
13.12
Qualified Persons Opinion
The
report authors are satisfied there are no other metallurgical or
metal recovery factors that could impact the recovery of metals,
the sale-ability of concentrates, or the potential for economic
extraction.
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Source:
Auryn
Locations
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14.
MINERAL RESOURCE ESTIMATES
Auryn
updated the Mineral Resource estimate for the Project using block
models constrained by new wireframe models. Grades for gold,
silver, copper, lead, arsenic and antimony were estimated into the
blocks using inverse distance cubed (ID3) weighting. Two block
models, one for the HM and HS, and another for the SR, were created
using Leapfrog . Block sizes for both models were 5 m x 5 m x 5 m,
subdivided in places to 0.5 m x 0.5 m x 0.5 m for better
representation of mineralized zones. The wireframe models were
constructed in Leapfrog by Auryn personnel. These wireframes
include new drilling completed by Auryn during the 2017 to 2018
field season at the SR and the 2017 to 2018 core re-logging data
focused on logging fluid pathway features. The assay data comprised
drilling and trench sampling results from programs conducted by
Auryn.
RPA’s
audit focused on HM and HS, since they represent the vast majority
of the Mineral Resource tonnage, and the methodology for the SR
model is similar. Based on the audit review, RPA is of the opinion
that the Mineral Resource estimation methodology and procedures
used by Auryn are reasonable and acceptable. The Auryn procedures
and RPA audit comments are documented in the following
sections.
14.1
Resource Database
There
are 377 drill holes and trenches in the Mineral Resource database,
43 of which were drilled since the previous Mineral Resource
estimate was performed by RPA in 2013 and updated in 2017. A number
of these holes were drilled on exploration targets remote from the
Mineral Resource area and were not used for the Mineral Resource
estimate. One drill hole (HR08-80) was excluded from the resource
estimate as it is parallel to the zone.
Records
from 270 drill holes were used for mineralized zone modelling. Of
these, only 202 holes intersect interpreted zones used in the
Mineral Resource estimation. There are 43,779 assays in the master
acQuire assay database, of which 1,136 (685 in the HM, 396 in the
HS, and 55 in the SR) are within interpreted zones (wireframes) in
the Mineral Resource database. The Mineral Resource database
includes tables for downhole surveys, lithology, and bulk density.
The assay table contains results for gold, silver, and copper, as
well as a suite of elements from ICP analyses.
Sample
lengths within mineralized zones range from 0.15 m to 3.3 m.
Orientations of both the holes and the mineralized zones vary
significantly, so the apparent width of zones often differs
substantially from the true width.
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reviewed the methods and procedures used by Auryn to generate the
Mineral Resource database including drilling, sampling, analysis,
and data entry. RPA found the work to be appropriate for the
deposit type and project goals, and the data to be suitable for
Mineral Resource estimation. Mineral Resource assay statistics are
listed in Table 14-1.
Mineral Resource Assay Statistics
Zone and | Au(ppm) | Ag(ppm) | Cu(ppm) | Pb(ppm) | As(ppm) | Sb(ppm) | Length(m) |
HM (Homestake | |||||||
Count | 685 | 685 | 666 | 666 | 638 | 638 | 685 |
Length | 852.20 | 852.20 | 832.05 | 832.05 | 804.13 | 804.13 | 852.20 |
Mean | 7.75 | 68.6 | 2112 | 981 | 194.7 | 84 | 1.24 |
Standard | 35.02 | 367.4 | 5549 | 4834 | 338.7 | 313 | 0.52 |
Coefficient of | 4.53 | 5.36 | 2.63 | 4.93 | 1.74 | 3.73 | 0.42 |
Minimum | 0 | 0 | 2 | 1.2 | 3.2 | 1 | 0.15 |
Median | 2.31 | 6.5 | 140.1 | 61.3 | 101 | 15.8 | 1.15 |
Maximum | 696.41 | 6798 | 69590 | 149600 | 4946 | 4000 | 3.30 |
HS (Homestake | |||||||
Count | 396 | 396 | 396 | 396 | 396 | 396 | 396 |
Length | 486.70 | 486.70 | 486.70 | 486.70 | 486.70 | 486.70 | 486.70 |
Mean | 3.49 | 154.2 | 280 | 1899 | 151.5 | 120 | 1.23 |
Standard | 9.57 | 499.7 | 556 | 7116 | 193.9 | 218 | 0.41 |
Coefficient of | 2.74 | 3.24 | 1.99 | 3.75 | 1.28 | 1.82 | 0.34 |
Minimum | 0.002 | 0.05 | 1 | 1 | 2 | 2.5 | 0.25 |
Median | 1.51 | 23.1 | 99.7 | 227.1 | 91 | 47.1 | 1.20 |
Maximum | 129.46 | 9027 | 4602.6 | 126700 | 1209 | 2369.1 | 2.90 |
SR (South Reef) | |||||||
Count | 55 | 55 | 55 | 55 | 55 | 55 | 55 |
Length | 75.95 | 75.95 | 75.95 | 75.95 | 75.95 | 75.95 | 75.95 |
Mean | 5.91 | 5.8 | 475 | 10 | 60.9 | 5 | 1.38 |
Standard | 10.91 | 11.1 | 1582 | 7 | 46.7 | 3 | 0.57 |
Coefficient of | 1.84 | 1.91 | 3.33 | 0.71 | 0.77 | 0.60 | 0.42 |
Minimum | 0.032 | 0.24 | 5.4 | 2.1 | 6.8 | 1.8 | 0.35 |
Median | 2.07 | 2.49 | 39.1 | 7.2 | 52.8 | 4.3 | 1.25 |
Maximum | 58.1 | 61.8 | 8899.7 | 33 | 223 | 14 | 2.00 |
Source:
Auryn, 2019
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14.2
Geological Interpretation
Wireframe
models of the mineralized zones were constructed in Leapfrog using
a nominal 2.3 g/t AuEq cut-off grade over a minimum horizontal
width of 2.0 m. In some cases, intervals with
< 2.0 g/t AuEq, or intervals shorter than two metres,
were included into the mineralized zones to preserve continuity.
The wireframe models were allowed to extend along strike and down
dip to the next drill hole intercept, regardless of distance
(generally 100 m or less, due to the drill spacing). On peripheral
boundaries, the models were generally constrained to a nominal
50 m distance from the outermost intercept, except for the
basal portion of HS.
Auryn
constructed low grade envelopes (at a nominal 0.1 g/t AuEq cut-off
grade) in Leapfrog to capture some of the remnant assays, and then
set the remaining blocks to zero grade. These low grade envelope
solids were solely made to allow for some grade in dilution where
appropriate. Their morphology is less well-defined than the more
accurate vein models, but less important to the model. RPA
recommends filtering out external minor inconsequential
‘blobs’ of dilution which occur away from the
mineralized zones.
reviewed the geological models for HM and HS in Leapfrog (Figure 14.1), and also compared them against
the vein models of the previous Mineral Resource estimate (RPA,
2017). RPA is of the opinion that the vein solids appear to be
better correlated as compared to the previous
estimate.
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Source:
RPA
Side) And HS (Right Side) Veins
The HM
and HS use slightly different methods with respect to how the veins
pinchout. RPA notes that the vein solids are constructed using both
a 0.2 m minimum thickness in the HM, but pinches out to zero
thickness in the HS. Also, the deeper part of the HS has only been
partially clipped to a polygonal boundary, many zones extend to the
bottom of the model as the vein thickness approaches
zero.
RPA
reviewed the modelled vein sets in plan and sections and noted that
significant proportions of the veins fall below the minimum nominal
two metre horizontal thickness. RPA flagged the block model for
horizontal thickness (TH) at regularly-spaced intervals, and
calculated grade X horizontal thickness (GTH) for each block in
order to determine how much of the deposit falls below a GTH
threshold of 4.0 (2.0 g/t AuEq minimum cut-off grade at 2.0 m
minimum TH, as per the Mineral Resource footnotes). RPA found that
approximately 18 percent of the Mineral Resource tonnes above the
cut-off grade occur in vein material one metre wide or
less.
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For the
next Mineral Resource estimate, RPA recommends updating the
geological model with a minimum thickness integrated into the vein
solids and making minor changes to the vein modelling methodology
in the HS to be more in line with the methodology employed for the
HM and eliminate minor pinchout artifacts in the peripheral HS
material.
14.3
True Thickness
flagged all blocks for “true thickness” (TT) by creating an
array of intercepts perpendicular to the main trend of the zones
and performing nearest neighbour (NN) estimate on the intercept
centroids. A histogram of Mineral Resource blocks that meet the
grade X true thickness (GTT) cut-off of 4.0 is
shown in Figure 14.2.
Source:
RPA
TT
Where GTT
> 4.0
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14-5
RPA
considers the geological modelling for 2019 to be of sufficient
quality for Mineral Resource estimation.
14.4
reatment of High-Grade Assays
14.4.1
Capping Levels
performed capping on individual veins (domains) based on composite
histograms and probability plots. RPA reviewed Auryn’s
capping levels and performed its own independent capping checks on
both assays and composites. RPA prefers to cap assays rather than
composites to avoid bias caused by smearing very narrow, high grade
samples into much longer composites. However, the Project sample
population does not generally contain extremely high grade, narrow
samples. Capping levels and statistics are shown in Table 14-2 and Table
14-3.
Capping: Au and Ag
Domain | | | | | | | |
hm_02 | Au | | | | | | |
hm_03 | Au | | | | | | |
hm_07 | Au | | | | | | |
hm_08 | Au | | | | | | |
hs_03 | Au | | | | | | |
hs_04 | Au | | | | | | |
hs_lg | Au | | | | | | |
sr_01 | Au | | | | | | |
sr_02 | Au | | | | | | |
|
|
|
|
|
|
|
|
hm_07 | Ag | | | | | | |
hm_08 | Ag | | | | | | |
hm_09 | Ag | | | | | | |
hm_lg | Ag | | | | | | |
hs_01 | Ag | | | | | | |
hs_02 | Ag | | | | | | |
hs_04 | Ag | | | | | | |
hs_05 | Ag | | | | | | |
hs_06 | Ag | | | | | | |
Effective Project |
|
Page
14-6
RPA is
of the opinion that capping levels are generally reasonable. Since
capping is performed on a per domain basis, it is possible that
small sample populations in each domain are leading to capping
levels that may be unfair to the overall grade in some
circumstances. RPA recommends reviewing the capping in future
estimates, to see whether capping by zone would be more appropriate
than capping by domain.
Capping: Cu, Pb, As, Sb
Zone | | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
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Page
14-7
14.5
High-Grade Restriction
No high
yield restriction (HYR) was performed on the Mineral Resource
model. RPA recommends investigating HYR as a precaution for
smearing high grade assays. To date, drill coverage is insufficient
to demonstrate that the highest grades in the deposit are being
smeared unfairly. RPA recommends checking whether HYR should be
implemented as more drilling is completed.
14.6
Compositing
Compositing
and capping were done separately ‘on the fly’ for each
ID3 or ordinary kriging (OK) estimator, rather than using one
Leapfrog composite table for all the estimators. This procedure has
the benefit of allowing flexibility in changes during grade
estimation, at the cost of having one composite table for all the
zones for validation purposes. Compositing is performed inside
Leapfrog to a nominal 2 m length, with the remaining subsample
length in each zone distributed equally between the intercept
composites.
zones are commonly narrow, and a rigid 2 m composite length would
have produced a high number of orphans (short remnants at the
margins of the wireframe models). In order to eliminate orphan
composites, compositing parameters were adjusted to distribute an
orphan sample length equally across all composites in the
intercept. For instance, if the intercept length was 5.5 m from
hanging wall to footwall contact, instead of two 2.0 m and one 1.5
m composites the software would produce two equal-length composites
of 2.75 m each. This produced a range of composite lengths between
0.5 m and 2.99 m. Auryn conducted an analysis to determine if the
composite length was correlated with grades. No correlation was
found. Unsampled intervals were treated as zero grade for gold and
silver, and ignored for copper, lead, arsenic, and antimony.
Descriptive statistics for composites in each zone are shown in
Table 14-4.
Effective Project |
|
Page
14-8
Composite Statistics
Zone | | | | | | | |
HM |
|
|
|
|
|
|
|
Count | 470 | 470 | 460 | 460 | 443 | 443 | 470 |
Length | 852.24 | 852.24 | 834.14 | 834.14 | 804.56 | 804.56 | 852.24 |
Mean | 7.73 | 68.60 | 2,136.00 | 990.00 | 194.90 | 84.00 | 1.81 |
Standard | 25.03 | 307.60 | 4,803.00 | 3,384.00 | 319.40 | 268.00 | 0.44 |
Coefficient | 3.24 | 4.49 | 2.25 | 3.42 | 1.64 | 3.19 | 0.25 |
Minimum | 0.00 | 0.10 | 2.12 | 2.80 | 7.00 | 1.30 | 0.49 |
Median | 2.78 | 7.30 | 217.00 | 80.00 | 105.20 | 17.00 | 1.90 |
Maximum | 399.81 | 3,904.30 | 34,780.00 | 38,592.00 | 4,946.00 | 2,851.00 | 2.98 |
HS |
|
|
|
|
|
|
|
Count | 278 | 278 | 277 | 277 | 277 | 277 | 278 |
Length | 491.72 | 491.72 | 490.64 | 490.64 | 490.64 | 490.64 | 491.72 |
Mean | 3.46 | 152.7 | 278 | 1889 | 150.9 | 119 | 1.77 |
Standard | 8.66 | 373.7 | 476 | 5751 | 180.9 | 182 | 0.50 |
Coefficient | 2.50 | 2.45 | 1.71 | 3.04 | 1.20 | 1.52 | 0.28 |
Minimum | 0.000 | 0.00 | 0.00 | 1 | 2 | 2.5 | 0.26 |
Median | 1.84 | 25.9 | 107 | 347 | 90.1 | 54 | 1.82 |
Maximum | 115.21 | 4143.0 | 3272 | 72164 | 1132.8 | 1579 | 2.99 |
SR |
|
|
|
|
|
|
|
Count | 40 | 40 | 40 | 40 | 40 | 40 | 40 |
Length | 75.52 | 75.52 | 75.52 | 75.52 | 75.52 | 75.52 | 75.52 |
Mean | 5.95 | 5.80 | 478.00 | 10.00 | 61.10 | 5.00 | 1.89 |
Standard | 10.08 | 11.10 | 1,490.00 | 7.00 | 45.20 | 3.00 | 0.41 |
Coefficient | 1.70 | 1.90 | 3.12 | 0.70 | 0.74 | 0.59 | 0.22 |
Minimum | 0.03 | 0.34 | 7.11 | 2.10 | 6.80 | 1.90 | 0.80 |
Median | 2.07 | 2.70 | 39.00 | 8.00 | 53.40 | 4.00 | 2.00 |
Maximum | 46.50 | 61.80 | 7,460.00 | 32.00 | 223.00 | 14.00 | 2.90 |
14.7
Variography
carried out variogram analyses on the normal score transformed
composited samples for gold, silver, and copper in the databases
for the HM and gold and silver for the HS. There were not enough
composites in the SR to generate meaningful variograms. For each
zone, a downhole variogram was generated using all composites
within the corresponding zone to estimate the nugget. A summary of
the variogram models is provided in Table
14-5.
Effective Project |
|
Page
14-9
Homestake Ridge
Project
NI43-101F1
Technical Report
Variography Results
| Directions(°) | Normalised | Orientations(°) | Ranges(m) | ||||||||
Metal | Model | Dip | | | | | | | | | | |
HM |
|
|
|
|
|
|
|
|
|
|
| |
Au | Sph | 71 | 41 | 135 | 0.56 | 0.44 | 40/114 | 44/331 | 19/221 | 80 | 70 | n/a |
Ag | Sph | 71 | 41 | 75 | 0.42 | 0.58 | 44/152 | 43/308 | 12/230 | 185 | 150 | n/a |
Cu | Sph | 71 | 41 | 135 | 0.13 | 0.87 | 40/114 | 44/331 | 19/221 | 120 | 120 | n/a |
HS |
|
|
|
|
|
|
|
|
|
|
| |
Au | Sph | 78 | 230 | 165 | 0.45 | 0.55 | 13/143 | 72/278 | 12/230 | 120 | 120 | n/a |
Ag | Sph | 78 | 230 | 45 | 0.42 | 0.58 | 44/152 | 44/308 | 12/230 | 250 | 180 | n/a |
Cu | Could |
|
|
|
|
|
|
|
| |||
Note:
1.
Sph: spherical structure model applied to the variogram
model
Effective Project |
|
Page
14-10
Homestake
Ridge Project
NI43-101F1
Technical Report
RPA
reviewed the variograms and found them to be reasonable. Search
distances reflect this variography and are appropriate in context
of the drill hole spacing. Auryn created ID3 estimators for grade
estimation within mineralized zones, and OK estimators for grades
within low grade (waste) zones. Estimators for each zone are
combined before being added to the Leapfrog block
model.
14.8
Search Strategy and Grade Interpolation
Parameters
variogram model ranges for silver and copper are significantly
larger (Table 14-5) than those for
gold. In RPA’s opinion, for multi-element estimates such as
that of the Project the element with the shortest range should
dictate what the search distances should be. For the 2010 estimate,
this range was set from the gold variogram model at a maximum of 75
m. For this estimate, the maximum range was extended to 100 m, and
the interpolations were run in three passes for all estimated
elements. In the first pass, the search ellipsoid measured 30 m x
30 m x 10 m. For the second and third passes, the search distances
were increased to 50 m x 50 m x 15 m and
100 m x 100 m x 25 m, respectively. The 100 m
ellipsoid was rarely required for the interpolations since most
blocks were captured within the 50 m range. The 75 m range was
retained, however, for classification of Inferred Mineral
Resources.
The
block grade interpolations were constrained to a minimum of three
and maximum of eight composites for the first two passes, with a
minimum of one and maximum of five for the third. In all passes,
the interpolations used a maximum of two composites from a single
drill hole. ID3 estimation was used for grade estimation within
mineralized zones, and OK estimation for estimating grades within
low grade (waste) zones.
As most
modelled mineralized zones are undulating, the Leapfrog variable
search orientation approach was chosen using modelled mineralized
veins for input orientations so that variable orientation searches
vary according to the local orientations of the
mineralization.
RPA
reviewed the variable orientation methodology and noted that the
block grades were being interpolated along the vein boundaries as
intended, however, this produced the effect of
“striping” the grade in parallel trends along vein
orientations away from assays. RPA recommends that Auryn review the
methodology in future Mineral Resource estimates to determine
whether the effect is desirable, and if not, then consider using
full-width composites given the drill spacing and the narrow
thickness of the veins. RPA does not anticipate that this
modification would have a material impact on the Mineral Resource
estimate.
Effective Project |
|
Page
14-11
Homestake
Ridge Project
NI43-101F1
Technical Report
14.9
Bulk Density
Bulk
density measurements collected by Auryn field personnel were used
to estimate the densities for each of the zones. Density
measurements were taken using a water immersion method on intact
pieces of drill core. Results for a total of 11,333 density
determinations were collected for the SR holes, although only a
small proportion of these measurements were taken in the
mineralized zones. 1,717 density measurements were taken on core
from within the high-grade zones. The average of the measurements
for each domain was assigned as the block density for that domain.
Domains hm_02a and hm_10 had no measurements, so the global average
for the HM was used.
reviewed the bulk density sampling in plan, section, and oblique
views in Leapfrog, and compared the bulk density statistics by zone
to the Auryn (2019) report. A plan view of the bulk density
measurements is shown in Figure 14.3 .
Bulk density statistics by domain are reproduced from the Auryn
(2019) report and are listed in Table
14-6 and Table 14-7.
RPA is
of the opinion that bulk density measurement methodology,
distribution, and coverage are appropriate for the
deposit.
Effective Project |
|
Page
14-12
Homestake
Ridge Project
NI43-101F1
Technical Report
Source:
RPA
Sample Distribution
Effective Project |
|
Page
14-13
Homestake
Ridge Project
NI43-101F1
Technical Report
Bulk Density by Zone
Statistics | | | | | | |
Count |
| 602 | 1,065 | 50 | 2,389 | 3,379 |
Mean | (t/m3) | 2.75 | 2.76 | 3.02 | 2.72 | 2.72 |
Standard |
| 0.12 | 0.17 | 0.18 | 0.07 | 0.09 |
Covariance |
| 0.04 | 0.06 | 0.06 | 0.02 | 0.03 |
Minimum | (t/m3) | 2.55 | 2.53 | 2.71 | 2.35 | 2.24 |
Median | (t/m3) | 2.72 | 2.72 | 2.98 | 2.70 | 2.70 |
Maximum | (t/m3) | 3.65 | 4.41 | 3.77 | 3.42 | 3.91 |
Bulk Density by Domain
Zone | | | Volume(m3) | | | | Volume(m3) |
HM | hm_01 | 2.81 | 89,990 | HS | hs_01 | 2.71 | 177,430 |
HM | hm_02 | 2.81 | 155,880 | HS | hs_02 | 2.73 | 355,300 |
HM | hm_02a | 2.75 | 65,855 | HS | hs_03 | 2.74 | 346,940 |
HM | hm_03 | 2.71 | 87,627 | HS | hs_04 | 2.82 | 255,650 |
HM | hm_04 | 2.7 | 34,890 | HS | hs_05 | 2.75 | 192,540 |
HM | hm_05 | 2.69 | 99,314 | HS | hs_06 | 2.78 | 283,590 |
HM | hm_06 | 2.72 | 5,757 | HS | hs_07 | 2.75 | 81,830 |
HM | hm_07 | 2.71 | 221,290 | HS | hs_08 | 2.78 | 8,320 |
HM | hm_08 | 2.75 | 234,820 | HS | hs_09 | 2.77 | 58,850 |
HM | hm_09 | 2.75 | 25,069 | HS | hs_lg | 2.72 | 12,307,000 |
HM | hm_10 | 2.75 | 12,295 | SR | sr_01 | 3.03 | 122,780 |
HM | hm_11 | 2.76 | 79,207 | SR | sr_02 | 3.01 | 80,310 |
HM | hm_lg | 2.72 | 7,652,900 |
|
|
|
|
14.10
Block Models
prepared two Mineral Resource block models using Leapfrog Edge
software: one for the HM+HS and one for the SR. All were arrays of
blocks measuring 5 m x 5 m x 5 m and further subdivided where
needed to 0.5 m x 0.5 m x 0.5 m in order to better model boundaries
within the model space. All variables were estimated for the parent
blocks first and then block values were assigned only to the
sub-blocks that were within modelled wireframes. Models were
rotated relative to the survey grid so as to be aligned with the
general strike of the mineralization – 325° clockwise
for the HM+HS model, and 305° clockwise for the SR model. All
coordinates are in UTM NAD83 Zone 9N. A plan view of both models is
shown in Figure 14.4. Block model
parameters are listed in Table 14-8 and
Table 14-9. Key block model variables
are described in Table
14-10.
Effective Project |
|
Page
14-14
Homestake
Ridge Project
NI43-101F1
Technical Report
The
sub-celled block size inside veins is very small (0.5 m) relative
to the drill spacing. RPA understands that this size was used by
Auryn to preserve the shape of the narrow veins in the sub-blocked
model. RPA is of the opinion that the block model schemas are
appropriate to the style of mineralization and the morphology of
the mineralized zones.
Block Model Geometry: HM and HS
Parameter | Value/Description |
Dip | 0.0 |
Azimuth | 325.0 |
Parent | 5m x 5m |
Size in | 100 m x |
Minimum | 463600.6139 |
Maximum | 462910.5632 |
Minimum | 463600 |
Maximum | 462911.1771 |
Sub-blocks | 10 |
Sub-blocks | 10 |
Sub-blocks | variable, |
Effective Project |
|
Page
14-15
Homestake
Ridge Project
NI43-101F1
Technical Report
Block Model Geometry: SR
Parameter | Value/Description |
Dip | 0.0 |
Azimuth | 305.0 |
Parent | 5m x 5m |
Size in | 64 x |
Minimum | 463519.3861 |
Maximum | 463245.4333 |
Minimum | 463520 |
Maximum | 463244.8193 |
Sub-blocks | 10 |
Sub-blocks | 10 |
Sub-blocks | variable, |
Key Block Model Variables
Variable | Description |
Au_ppm | Au |
Ag_ppm | Ag |
Cu_pct | Cu |
Pb_pct | Pb |
As_ppm | As |
Sb_ppm | Sb |
Au_ppm | Au |
AuEq_ppm | Calculated |
NSR | Calculated |
rescat | Resource |
density | Bulk |
Zone | Homestake |
Domain | Modelled |
MinDist | Distance |
Samples | Number |
AvDist | Average |
EstPass | Estimation |
|
|
Effective Project |
|
Page
14-16
Homestake
Ridge Project
NI43-101F1
Technical Report
Models
Effective Project |
|
Page
14-17
Homestake
Ridge Project
NI43-101F1
Technical Report
14.11
Cut-off Grade
The
same cut-off grade was used for the purpose of this Mineral
Resource estimation as in RPA (2017), as described on pages 14-29
and 14-30 of the NI43-101 Technical Report.
The
cut-off grade was applied using AuEq values calculated from the
interpolated grade of each block and assumed metal prices, mill
recoveries, and smelter terms:
Metal
prices:
■
Silver –
US$20/oz
■
Gold –
US$1,300/oz
■
Copper –
US$2.50/lb
Mill
recoveries:
■
Silver – 88.0
percent
■
Gold – 92.0
percent
■
Copper – 87.5
percent
C$:US$
Exchange Rate:1.2:1
The
AuEq calculation included provisions for treatment charges,
refining costs, and transportation. Metallurgical recoveries were
based on test work completed by Homestake. It was assumed that the
mill process would comprise conventional grinding, gravity
separation, and flotation. Two mill circuits were contemplated, one
producing a copper concentrate and the other a bulk concentrate.
The copper circuit would treat only copper-rich material, which was
defined in the model as anything with a grade of 0.1 percent Cu or
higher. Separate estimates of the AuEq for each of the copper and
bulk concentrates were derived. Multipliers were derived for
estimation of the NSR for each unit (i.e. g/t or percent) of metal
in the resource blocks which were then converted to AuEq. For the
copper-rich blocks these multipliers were as follows:
■
Silver –
US$0.62 per g/t Ag
■
Gold –
US$42.79 per g/t Au
■
Copper –
US$42.82 per percent Cu
Effective Project |
|
Page
14-18
Homestake
Ridge Project
NI43-101F1
Technical Report
For the
copper-poor portion, the multipliers were:
■
Silver –
US$0.56 per g/t Ag
■
Gold –
US$39.26 per g/t Au
The
AuEq value was assigned to the blocks by dividing the NSR total by
the gold factor. A cut-off of 2 g/t AuEq was used to select blocks
to be included in the Mineral Resources. The cost cutoff was
derived from RPA’s experience with similar
projects.
RPA
reviewed these assumptions in the context of the updated Mineral
Resource and confirms that overall they continue to be reasonable.
Further stope optimization will determine how much of the Mineral
Resource would be discarded due to low grades or insufficient
mining widths.
14.12
Classification
CIM
(2014) definitions were used for Mineral Resource classification.
As per CIM (2014) definitions, a Mineral Resource is defined as
“a concentration or occurrence of solid material of economic
interest in or on the Earth’s crust in such form, grade or
quality and quantity that there are reasonable prospects for
eventual economic extraction”. Mineral Resources are
classified into Measured, Indicated, and Inferred categories. A
Mineral Reserve is defined as the “economically mineable part
of a Measured and/or Indicated Mineral Resource” demonstrated
by studies at Pre-Feasibility or Feasibility level as appropriate.
Mineral Reserves are classified into Proven and Probable
categories.
Per
Auryn (2019), blocks within 75 m of a composite were provisionally
assigned to the Inferred category. This distance was derived from
the variogram analysis for gold in the zones. Blocks in the HM
within 20 m of the nearest composite, and estimated by composites
from at least two drill holes, were provisionally upgraded to the
Indicated category. Auryn then performed a manual reclassification
of the blocks, adhering to the following general guidelines
recommended by RPA for manual smoothing of classification produced
by algorithmic methods:
■
The Indicated to
Inferred classification boundary should consider the grade
trends.
■
Areas of higher
grade Indicated blocks should be reviewed with respect to the
adjacent drill holes to ensure that high grade blocks are
associated with at least two, preferably three, high grade drill
holes.
■
Peripheral low
grade intercepts should be excluded from a class, and possibly the
domain before grade estimation.
Effective Project |
|
Page
14-19
Homestake
Ridge Project
NI43-101F1
Technical Report
■
Classification area
geometry should be smoothed and reflect supporting two dimensional
arrays of holes.
■
One dimensional
rows of holes do not support Indicated material.
■
Isolated islands of
other classes can be variably retained or smoothed depending on
changes in grade and the desire to drill infill holes in those
areas.
■
In areas where
there is ambiguity with respect to which class should be assigned,
decisions should be made including thickness and grade continuities
in that volume.
■
Isolated one hole
intercepts should not be classified as Indicated.
■
Material
“trading” between classes as a result of these
practices may result in neutral tonnage changes.
■
Avoid placing
classification boundaries on drill hole intercepts.
RPA
reviewed the classification criteria and results and is of the
opinion that, overall, they are appropriate and
reasonable.
14.13
Block Model Validation
Auryn
validated the block models using the following
methods:
■
of drill holes and estimated block grades (e.g. Figure 14.5).
■
comparison of mean composite grades and block model grades
(Table 14-11)
■
plots of the block grades estimated by ID3 and block grades
estimated using the NN method (e.g) Figure
14.6.
The
block grades were observed to honour the local composite grades
reasonably well. Remote sections of the domains, informed by
composites from only one hole or sometimes even just one composite,
tended to be poorly estimated. Often large numbers of these
outermost blocks ended up with the same grade, which could tend to
bias the global average grade. Additional definition drilling would
be required to improve the block grade estimates for these areas.
These peripheral blocks included in the Mineral Resources were
classified as Inferred.
RPA’s
comparison of block versus composite statistics showed some marked
differences in the block means relative to the sample means. Review
of the samples in longitudinal section found that the statistical
discrepancies were primarily an artifact of declustering of
composite grades during the estimation process.
Effective Project |
|
Page
14-20
Homestake
Ridge Project
NI43-101F1
Technical Report
RPA
performed visual validation of composite versus block grades in
longitudinal sections for all domains in the HM and HS and
generated its own swath plots. RPA found that block grade
distribution is in general accord with composite
grades.
Statistical Comparison of Block Model Grades
| | | | ||||||
Domain | | | | | | | | | |
| 4.81 | | | | | | | | |
| 10.09 | | | | | | | | |
| 5.13 | | | | | | | | |
| 6.52 | | | | | | | | |
| 3.36 | | | | | | | | |
| 3.17 | | | | | | | | |
| 3.37 | | | | | | | | |
| 5.8 | | | | | | | | |
| 7.34 | | | | | | | | |
| 1.75 | | | | | | | | |
| 0.74 | | | | | | | | |
| 4.83 | | | | | | | | |
| 1.22 | | | | | | | | |
| 3.76 | | | | | | | | |
| 3.87 | | | | | | | | |
| 4.08 | | | | | | | | |
| 3.16 | | | | | | | | |
| 2.62 | | | | | | | | |
| 1.24 | | | | | | | | |
| 4.11 | | | | | | | | |
| 0.14 | | | | | | | | |
| 3.78 | | | | | | | | |
| 10.33 | | | | | | | | |
Source:
Auryn, 2019
Effective Project |
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Page
14-21
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Ridge Project
NI43-101F1
Technical Report
Source:
Auryn, 2019
Example
Effective Project |
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Page
14-22
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Ridge Project
NI43-101F1
Technical Report
Source:
Auryn, 2019
and Z, Width 30 m)
Effective Project |
|
Page
14-23
Homestake
Ridge Project
NI43-101F1
Technical Report
14.14
Mineral Resource Reporting
reports Mineral Resources from two separate block models in
Leapfrog. Table 14-12 summarizes the
December 31, 2019 Mineral Resource estimate for the Project by
zone. Both Indicated and Inferred Mineral Resources are reported
within modelled vein solids, however, without dilution built into
the model.
Mineral Resources – December 31, 2019
Auryn Resources Inc. – Homestake Ridge Project
Classification And | | | | ||||||
| | | | | | | | ||
Indicated |
|
|
|
|
|
|
|
|
|
HM | | 7.02 | 74.8 | 0.18 | 0.077 | 165,993 | 1.8 | 2.87 | 1.25 |
Total | | | | | | | | | |
|
|
|
|
|
|
|
|
|
|
Inferred |
|
|
|
|
|
|
|
|
|
HM | | 6.33 | 35.9 | 0.35 | 0.107 | 355,553 | 2.0 | 13.32 | 4.14 |
HS | | 3.13 | 146.0 | 0.03 | 0.178 | 337,013 | 15.7 | 2.19 | 13.20 |
SR | | 8.68 | 4.9 | 0.04 | 0.001 | 124,153 | 0.1 | 0.36 | 0.00 |
Total | | | | | | | | | |
Source,
Auryn 2019
Notes:
1.
Canadian Institute of Mining, Metallurgy and Petroleum (CIM)
Definition Standards for Mineral Resources and Mineral Reserves
dated May 10, 2014 (CIM (2014) definitions), as incorporated by
reference in NI43-101, were followed for Mineral Resource
estimation.
2.
Mineral Resources are estimated at a cut-off grade of 2.0 g/t
AuEq.
3.
AuEq values were calculated using a long-term gold price of
US$1,300 per ounce, silver price at US$20 per ounce, and copper
price at US$2.5 per pound and a US$/C$ exchange rate of 1.2. The
AuEq calculation included provisions for metallurgical recoveries,
treatment charges, refining costs, and transportation.
4.
Bulk density ranges from 2.69 t/m3 to 3.03
t/m3
depending on the domain.
5.
Differences may occur in totals due to rounding.
6.
The Qualified Person responsible for this Mineral Resource Estimate
is Philip A. Geusebroek of Roscoe Postle Associates Inc. (RPA), now
part of SLR Consulting Ltd (SLR).
7.
The reader is cautioned that Mineral Resources that are not Mineral
Reserves do not have demonstrated economic viability.
Effective Project |
|
Page
14-24
Homestake
Ridge Project
NI43-101F1
Technical Report
8.
HM=Homestake Main Zone, HS= Homestake Silver Zone, and SR= South
Reef Zone.
Resource sensitivity to cut-off grade is shown in Table 14-13. Deleterious elements also
estimated in the Mineral Resource model are listed by Mineral
Resource category, at the 2.0 g/t AuEq Mineral Resource base case
cut-off, in Table 14-14.
Mineral Resources – Sensitivity by Cut-Off Grade
Auryn Resources Inc. – Homestake Ridge Project
| | | | ||||||
| | | | | | | | ||
Total | |||||||||
5.0 | 0.372 | 10.99 | 131.3 | 0.20 | 0.120 | 131,463 | 1.6 | 1.7 | 0.99 |
4.0 | 0.465 | 9.57 | 111.2 | 0.20 | 0.105 | 142,911 | 1.7 | 2.0 | 1.07 |
3.0 | 0.592 | 8.18 | 90.5 | 0.19 | 0.090 | 155,730 | 1.7 | 2.5 | 1.18 |
2.0* | | | | | | | | | |
1.0 | 0.862 | 6.19 | 65.2 | 0.17 | 0.069 | 171,441 | 1.8 | 3.1 | 1.32 |
Total | |||||||||
5.0 | 2.158 | 8.25 | 145.7 | 0.21 | 0.216 | 572,444 | 10.1 | 9.8 | 10.26 |
4.0 | 2.972 | 6.78 | 133.4 | 0.18 | 0.189 | 648,212 | 12.8 | 11.9 | 12.36 |
3.0 | 4.136 | 5.52 | 118.6 | 0.15 | 0.163 | 734,275 | 15.8 | 14.0 | 14.84 |
2.0 | | | | | | | | | |
1.0 | 6.448 | 4.09 | 90.9 | 0.12 | 0.127 | 847,996 | 18.9 | 17.0 | 18.07 |
Source,
Auryn 2019
Notes:
1.
CIM (2014) definitions were followed for Mineral Resource
estimation.
2.
Mineral Resources are estimated at a cut-off grade of 2.0 g/t
AuEq.
3.
AuEq values were calculated using a long-term gold price of
US$1,300 per ounce, silver price at US$20 per ounce, and copper
price at US$2.5 per pound and a US$/C$ exchange rate of
1.2.
4.
Bulk density ranges from 2.69 t/m3 to 3.03
t/m3
depending on the domain.
5.
Differences may occur in totals due to rounding.
6.
The Qualified Person responsible for this Mineral Resource Estimate
is Philip A. Geusebroek of RPA.
Effective Project |
|
Page
14-25
Homestake
Ridge Project
NI43-101F1
Technical Report
Deleterious Element Content of Mineral Resources
Classification |
| | | ||
| | | | | |
Indicated |
|
|
|
|
|
HM | 0.736 | 241 | 91 | 177 | 67 |
Total | | | | | |
|
|
|
|
|
|
Inferred |
|
|
|
|
|
HM | 1.747 | 137 | 93 | 239 | 163 |
HS | 3.354 | 141 | 128 | 473 | 428 |
SR | 0.445 | 58 | 5 | 26 | 2 |
Total | | | | | |
Note:
1.
Numbers may not add due to rounding.
14.15
Comparison to Previous Estimates
previous Mineral Resources estimate for the Project, effective as
of September 1, 2017, is described in detail in the NI43-101 report
prepared by RPA and dated October 23, 2017 (RPA, 2017). A
comparison of the 2017 and 2019 estimates is presented in Table 14-15.
Effective Project |
|
Page
14-26
Homestake
Ridge Project
NI43-101F1
Technical Report
Comparison of 2017 and 2019 Mineral Resource Estimates
Classification | | | | ||||
| | | | | | ||
2017 | |||||||
Indicated |
|
|
|
|
|
|
|
HM | 0.624 | 6.25 | 47.9 | 0.18 | 125,000 | 1.00 | 2.40 |
Total | | | | | | | |
|
|
|
|
|
|
|
|
Inferred |
|
|
|
|
|
|
|
HM | 2.098 | 5.53 | 28.0 | 0.30 | 373,000 | 1.90 | 14.00 |
HS | 4.810 | 2.71 | 124.4 | 0.02 | 419,000 | 19.20 | 2.60 |
SR | 0.337 | 12.88 | 3.6 | 0.04 | 140,000 | 0.04 | 0.30 |
Total | | | | | | | |
2019 | |||||||
Indicated |
|
|
|
|
|
|
|
HM | 0.736 | 7.02 | 74.8 | 0.18 | 165,993 | 1.77 | 2.87 |
Total | | | | | | | |
|
|
|
|
|
|
|
|
Inferred |
|
|
|
|
|
|
|
HM | 1.747 | 6.33 | 35.9 | 0.35 | 355,553 | 2.02 | 13.32 |
HS | 3.354 | 3.13 | 146.0 | 0.03 | 337,013 | 15.74 | 2.19 |
SR | 0.445 | 8.68 | 4.9 | 0.04 | 124,153 | 0.07 | 0.36 |
Total | | | | | | | |
Percentage | |||||||
Indicated |
|
|
|
|
|
|
|
HM | 17.9% | 12.3% | 56.2% | -1.7% | 32.8% | 77.0% | 19.5% |
Total | | | | | | | |
|
|
|
|
|
|
|
|
Inferred |
|
|
|
|
|
|
|
HM | -16.7% | 14.5% | 28.2% | 15.3% | -4.7% | 6.1% | -4.9% |
HS | -30.3% | 15.3% | 17.4% | 48.4% | -19.6% | -18.0% | -15.6% |
SR | 31.9% | -32.6% | 36.4% | -8.5% | -11.3% | 80.0% | 19.6% |
Total | | | | | | | |
Effective Project |
|
Page
14-27
Homestake
Ridge Project
NI43-101F1
Technical Report
A
significant increase in the Indicated Mineral Resources, along with
a decrease in Inferred Mineral Resources can be noted. Overall
metal contents have decreased in the Inferred category, despite
increases in average metal grades. Metal content in the Indicated
category has increased in conjunction with gold and silver
grades.
The
2019 Mineral Resource estimate was influenced by a number of
factors, which had fairly wide ranging impacts. Some influencing
factors resulted in increased grades at the expense of tonnage,
while others had the opposite effect. RPA is of the opinion that
the principal factors driving the observed changes to the Mineral
Resource estimates are as follows:
■
A change in the
mineralized zone modelling approach.
■
Utilization of a
variable search method for grade estimation.
■
Additional drilling
in the SR.
The
drillholes added at the SR since the last estimate resulted in an
increase in tonnage and reduction of gold grade in the SR, which
produced a net decrease in overall gold content at SR.
The
changes to the mineralized zone modelling approach resulted in less
fragmented wireframe models. This increase in model continuity,
combined with variable search utilized for grade estimation,
contributed to a net increase in the Indicated Mineral Resources at
HM, and subsequent decrease in Inferred Mineral
Resources.
Similarly,
changes to the modelling of mineralization in the HS resulted in
removing some of the isolated wireframe fragments of a limited
number of high grade intercepts, by integrating them into more
continuous mineralized zones. The overall effect of these changes
were a net reduction in tonnage and an increase in average metal
grades, with a moderate net negative impact to metal content at
HS.
14.16
Comments on Section 14
Based
on the audit review, RPA is of the opinion that the Mineral
Resource estimation methodology and procedures used by Auryn are
reasonable and acceptable and that the Mineral Resource estimate
complies with the CIM (2014) definitions.
RPA is
not aware of any environmental, permitting, legal, title, taxation,
socio-economic, marketing, political, or other relevant factors
that could materially affect the Mineral Resource
estimate.
Effective Project |
|
Page
14-28
15.
MINERAL RESERVE ESTIMATES
There
are no mineral reserves at Homestake Ridge.
Effective Project |
|
Page
15-1
16.
MINING METHODS
16.1
Overview
The PEA
mine plan and production schedule were generated with Deswik Stope
Optimizer (DSO) software on the basis of an updated geological
model provided by Auryn. The updated geological model included new
resource wireframes and an updated block model. Payable metals in
the model included gold, silver, copper and lead, but did not
include zinc.
The
updated block model was queried by the Deswik Stope Optimizer (DSO)
to produce stope wireframes and a life of mine production schedule
for each of the three principal deposits. The DSO program generated
all the necessary lateral and vertical development in support of
mining.
16.2
Geotechnical Considerations
There
have been no geotechnical studies at Homestake Ridge. A preliminary
opinion on ground conditions to be expected in the underground mine
was based solely on core photographs and rock quality (RQD)
measurements in the following exploration drillholes:
■
HR06-30 (Homestake
Main)
■
HR09-150 (Homestake
Silver)
■
HR10-198 (Homestake
Silver)
■
HR10-199 (Homestake
Silver)
■
HR12-245 (South
Reef)
■
HR10-206 (South
Reef)
No rock
mass ratings (RMR) are available, however, based on the excellent
rock quality observed in the core photographs, it is anticipated
that ground conditions will be “good” to “very
good” and will support large open spans in the order of
20 m. This needs to be confirmed with a program of
geotechnical data collection and analyses.
16.3
Cut-Off Grade
mining cut-off grade of 3.5 gpt per AuEq oz was used to develop the
stope wireframes for mining based on the calculations in Table 16-1 below.
Effective Project |
|
Page
16-1
Cutoff Grade Calculation
| Rate | Notes |
Gold | US$1,350.00 US$43.40 |
|
Foreign | C$1.00=US$0.70 |
|
Au | 0.85% |
|
Gross | C$52.70 | Per |
|
|
|
All-in | C$127.70 | Per |
Capitalized | C$27.68 | Per |
Contingency | C$31.07 | 20% |
Onsite | C$186.46 | Per |
Cutoff | |
|
16.4
Mining Method
principal mining method utilized in the DSO runs was longhole
stoping (LHOS) based on a 20 m sublevel interval. Each
sublevel consists of an ore drive off a spiral ramp connecting to
the level access as depicted on Figure
16.1. A minimum mining width of 2.5 m was selected to
allow for mechanized mining.
Effective Project |
|
Page
16-2
Source:
MineFill Services, Inc.
Homestake Ridge
16.5
Production Schedule
The
main deliverable from the Deswik stope optimizer was a life of mine
production schedule based on a combined 900 tpd mill feed rate.
This yields a mine life of just under 13 years.
The
total mill feed includes roughly 2.87 M stope tonnes, and an
additional 0.55 M of mineralized development tonnes for a total of
3.42 Mt. Just under 50 percent of the mineralized tonnes come from
the Homestake Main deposit. The Silver deposit contributes another
41 percent, and the South Reef contributes the final 11
percent.
Effective Project |
|
Page
16-3
Life of Mine Production Schedule
| | | | |
1 | 61,930 | 61,930 | – | – |
2 | 239,574 | 239,574 | – | – |
3 | 299,993 | 299,993 | – | – |
4 | 299,954 | 299,954 | – | – |
5 | 299,925 | 299,925 | – | – |
6 | 299,997 | 299,997 | – | – |
7 | 299,984 | 144,746 | 155,238 | – |
8 | 299,962 |
| 299,962 | – |
9 | 299,846 |
| 299,846 | – |
10 | 299,963 |
| 299,963 | – |
11 | 299,980 |
| 248,900 | 51,080 |
12 | 300,000 |
| 89,712 | 210,289 |
13 | 123,666 |
| 11,003 | 112,663 |
LOM | 3,424,755 | 1,646,120 | 1,404,624 | 374,032 |
As required by NI43-101, the author cautions the reader that the
PEA is preliminary in nature, that it includes Inferred mineral
resources that are considered too speculative geologically to have
the economic considerations applied to them that would enable them
to be categorized as mineral reserves, and there is no certainty
that the preliminary economic assessment will be
realized.
Effective Project |
|
Page
16-4
Schedule
16.6
Dilution
(equivalent linear overbreak) of 0.25 m was added at the
hangingwall and footwall to account for dilution. The resulting
dilution is shown on Table 16-3
below.
Stope Tonnage Dilution
Zone | | | | |
Stope | 2,874,164 | 1,392,472 | 1,174,634 | 307,058 |
Dilution | 393,413 | 171,707 | 129,271 | 92,435 |
Dilution | 17.14 | 16.11 | 13.76 | 30.81 |
Effective Project |
|
Page
16-5
16.7
Mine Development
mine development will be accomplished by mechanized trackless
equipment. The PEA mine plan includes a combined 10 km of
ramps in the three deposits, 12 km of level access, and another 22
km of ore drives primarily in mineralized material. A summary
of the life of mine production development is included in Table 16-4.
Life of Mine Development Lengths
Year |
| | | |
Refuge | 331 | 143 | 162 | 26 |
Re-muck | 2,398 | 1,034 | 1,034 | 330 |
Electric-Sub | 369 | 162 | 177 | 30 |
Sumps | 753 | 353 | 306 | 94 |
Ramp | 10,106 | 4,461 | 3,640 | 2,006 |
Level | 11,942 | 6,095 | 4,308 | 1,539 |
Ore | 22,493 | 10,545 | 9,379 | 2,569 |
Vertical | 1,433 | 634 | 527 | 272 |
Lateral | 26,521 | 12,672 | 9,747 | 4,102 |
Vertical | 1,433 | 634 | 527 | 272 |
Table 16-5 presents a summary of the lateral development
openings.
Lateral Development Summary
Drift | |
Refuge | 4.5m |
Re-muck | 4.5m |
Electric-Substation | 4.5m |
Sumps | 4.0m |
Ramps | 4.5m |
Level | 4.5m |
Ore | 3.5m |
Cross | 3.5m |
Effective Project |
|
Page
16-6
16.7.1
Equipment Utilization
The
ramps, level access and ancillary openings can be accomplished with
mechanized 2-boom jumbos such as the Sandvik DD321, 6.7 tonne
LHD’s such as the Sandvik LH307, and mechanized rock bolters
such as the Sandvik DS311.
Smaller
headings such as the main drives and stope development will be
accomplished with smaller 1-boom jumbos such as a Sandvik DD211,
4.5 tonne LHD’s such as the Sandvik LH204, and scissor decks
or smaller rock bolters such as a Sandvik DS211.
Ore
haulage is expected to comprise small articulated 15-tonne trucks
such as a Sandvik TH315.
expected equipment utilization is summarized on Table 16-6 below.
Major Equipment Utilization (hours x 1000) by Project
Year
16.8
Mine Backfill
The
primary mining method of longhole retreat stoping will employ the
use of uncemented rockfill to backfill the mine voids as the stope
advances. Since the mine will advance by overhand methods, the
backfill will used as the working floor for mining the stope on the
sublevel above.
following schedule outlines the backfill demand over the life of
mine (Table 16-7). The mine is expected
to consume roughly 1.2 million m3 of rockfill over the
life of the mine, or roughly 275,000 tpa.
Backfill Demand by Project Year (m3)
Effective Project |
|
Page
16-7
16.9
Mine Services
16.9.1
Ventilation
The PEA
mine plan includes 1,433 m of vertical raises for ventilation.
While no ventilation infrastructure is included in the PEA, the
intent is to develop the ramps as fresh-air intakes, and the
vertical raises for exhaust. The fan sizing and airflows will be
determined in the next phase of study.
16.9.2
Compressed Air
Each of
the three mining zones will be supplied with compressed air from a
compressor station located near the mine portal. The demand for
compressed air will be determined in the next phase of
study.
16.9.3
Water
Non-potable
water will be provided for industrial uses, and for the
underground, such as drilling.
16.9.4
Mine Dewatering
No
ground water hydrology studies have been completed to date hence
the mine dewatering requirements have not been defined. However,
based on the exceptional rock quality and intact nature of the rock
mass, groundwater accumulation in the mine is not expected to be an
issue. A Feasibility mine plan would include hydrogeological
studies and measurements, estimates of groundwater infiltration
into the mine, and suitable mine dewatering
infrastructure.
16.9.5
Electrical Power
The
demand for electrical power has not been estimated at this stage of
study, however it is anticipated that each zone will require a
substation providing 4160 V and 480 V power to the
underground.
16.9.6
Emergency Egress and Refuge
The PEA
mine plan includes vertical raises that will serve as a secondary
emergency egress in the event of a loss of electrical power or a
fire. The mine plan also includes infrastructure for emergency
refuge.
Effective Project |
|
Page
16-8
17.
RECOVERY METHODS
Processing
of Homestake Ridge mineralization will be complicated by the
difference in metal contents across the 3 principal deposits. The
Homestake Main mineralization is high in copper, low in lead, and
moderate in zinc. The Homestake Silver and South Reef
mineralization has low copper grades. Homestake Silver has
relatively low gold grades but high lead, zinc, and silver grades.
South Reef is essentially just gold with a minor amount of
copper.
81 percent of the gross metal value at Homestake Ridge is gold,
another 14 percent is silver, and just over 4 percent is the base
metals content. Realization of the value of the Homestake Ridge
deposits is obviously dependant on recovery of precious metals
rather than base metals. The insitu distribution of metals is shown
on Table 17-1 below.
Metals Distribution at Homestake Ridge
Zone | | | | |
HM | 57.6% | 27.6% | 88.5% | 35.0% |
HS | 26.4% | 72.0% | 9.1% | 65.0% |
SR | 16.0% | 0.4% | 2.4% | 0.1% |
17.1
Flowsheet Development
Different
processing streams are required to liberate the metals from these
deposits. Rather than blending into one process stream, the optimal
process strategy appears to be campaign mining and processing:
Homestake Main would be exploited first to produce a single copper
concentrate; then mining and processing at Homestake Silver to
produce a single lead/zinc concentrate. The changeover from the
Main to Silver deposits will not require any equipment changes in
the grinding circuit, but it may require a change to the grind
size, and a change to the chemistry in the flotation
circuit.
The
process flowsheet consists of:
■
Crushing and
grinding to produce a primary grind P80 of 150 to 200
microns
■
Gravity recovery of
gold
■
Flotation to
produce an initial base metal concentrate
■
Secondary flotation
to produce a pyrite concentrate
Effective Project |
|
Page
17-1
■
Regrinding of the
pyrite concentrate to a grind P80 of 20 to 25 microns
■
Cyanide leaching of
the pyrite concentrate.
Source:
Shouldice 2016
17.1: Proposed Flowsheets for Homestake Main (Copper
Circuit)
and Homestake Silver (Lead/Zinc Circuit)
Note: The South Reef mineralization would be processed with the
Homestake Main material.
Effective Project |
|
Page
17-2
final metallurgical recoveries to concentrate produced by this
flowsheet are shown in Table 17-2
below.
Metallurgical Recoveries
Metal | | | | |
Gold | 55% | 65% | 29.2% 24.0% | 85.5% |
Silver | 45% | 50% | 22.8% 27.3% | 74.6% |
Copper | 75% |
|
| 74.6% |
Lead |
| 70% |
| 45.3% |
final concentrates are expected to contain the following metal
values (Table 17-3):
Concentrate Grades
Zone | | | |
Gold | 555 | 524 | 6.5% |
Silver | 3,384 | 17,310 | 93.5% |
Copper | 28% | — |
|
Lead | — | 30% |
|
the life-of-mine the expected concentrate production is shown in
Table 17-4.
Concentrate Production – Life of Mine
| |
Copper | 10,876 |
Lead | 6,006 |
Doré | 2,583,500 |
Effective Project |
|
Page
17-3
17.2
Deleterious Elements
of the final concentrates produced in the laboratory were performed
to identify any deleterious elements
that may result in penalties by a smelter. The results are shown
in Table 17-5 for the copper concentrate, and the
lead/zinc concentrate.
Deleterious Elements in the Concentrates
Product | | | | | | |
Copper | | <30 | 40 | <30 | 0.24 | 5780 |
Lead/zinc | | 30 | 180 | 50 | 0.16 | 5780 |
The
results show elevated levels of arsenic, antimony and mercury which
may trigger smelter penalties. While some smelters may reject
concentrates with these levels, it is unlikely to apply to these
concentrates due to the exceptionally high precious metal
content.
Effective Project |
|
Page
17-4
18.
PROJECT INFRASTRUCTURE
There
is no existing infrastructure at the Homestake Ridge Project site.
The site is remote from any local grid power supply, water supply
and direct highway access. The following sections outline the
infrastructure development needed for project startup. The final
infrastructure plan is shown in Figure 18.1 below.
Source:
Auryn
Figure 18.1: Site Development Plan
18.1
Site Access
Development
of the Homestake Ridge Project will require the completion of an
access road from Alice Arm to the project area. The first 27 km of
this road was completed in the early 1900’s, however the last
6.5 km remained as a primitive road. The first 30 km of this road
was upgraded in 2004/2005, and again in 2014, by Kitsault
Hydroelectric Corporation to provide access to the Kitsault Storage
dam hydro scheme.
Effective Project |
|
Page
18-1
The
Alice Arm road would be built to Provincial standards to allow the
passage of highway legal loads. This final link would create
year-round access to regional and provincial highways.
A
design for the Alice Arm-Homestake Ridge road link was completed in
2009 in support of plans for development of hydroelectric power on
Kitsault Lake. The proposed road configuration includes a one-lane
5 m wide gravel running surface, with pullouts, for a 40 km/hr
design speed. The road would likely be operated as radio-controlled
limited access haul road similar to a logging road. The road would
be designed for 50-tonne GVW loads with a load limit of
80-tonnes.
proposed route, as shown in Figure 18.2
will require the construction of 6 clear span steel bridges at the
Kitsault River, Homestake Creek, and 4 other sites. The remaining
non fish-bearing crossings will be done with culverts.
The
final road designs include access to the proposed plant site area,
and a person-camp.
Source:
Auryn
Effective Project |
|
Page
18-2
18.2
Barge Landing
A barge
landing will be constructed in Alice Arm at the southern end of the
Alice Arm access road to accommodate delivery of fuel, reagents,
mine consumables, and construction materials. The barges will be
used to ferry materials from the Port of Stewart, some 225 km by
sea.
18.3
Power
As has
been noted the Homestake Ridge Project site is remote from any
existing grid power. The project is expected to require an
installed capacity of about 8 MW of power, 24 hours a day, equating
to 70 GW-hr of energy consumed annually. At the current BC Hydro
bulk industrial rate of C$0.06 per kW-hr that equates to C$4.2
million annually.
Several
options are available for supplying power to the
project:
■
Construction of a
transmission line to connect to an existing grid
■
Construction of a
mini-hydro scheme at the project site
■
Installation of
diesel generators
■
Installation of
gas-powered generators.
Knight
Piesold completed a review of the above options in 2011 and the
following sections outline their findings.
18.3.1
Transmission Line Alternative
Two
connections are possible for connecting to the existing BC Hydro
electric grid.
The
first is construction of a 32 km transmission line down the
Kitsault River valley to connect to the grid in Kitsault. The line
would parallel the Alice Arm access road to the head of Alice Arm
Inlet. From the line would cross the Kitsault River and travel
southeast to the town of Kitsault. This connection is energized at
138 kV. This circuit may have to be upgraded to supply the 8MW
demand needed at Homestake Ridge. The estimated cost of this
alternative was C$33 million in 2011.
The
second option is construction of a 45 km transmission line running
east from the north end of Kitsault Lake towards the Niska Mainline
road. The line would parallel Niska Mainline road to Niska Creek,
then Nass River and finally connecting with the BC Hydro
138 kV transmission line at Highway 37. The estimated cost of
this alterative was C$41 million in 2011.
Effective Project |
|
Page
18-3
18.3.2
Hydropower Alternatives
Several
run-of-river and stored capacity hydro-electric resources are
available in the vicinity of the project. The most attractive
run-of-river sites are Homestake Creek, the Upper Kitsault River
and the West Kitsault River. Knight Piesold completed a high-level
assessment of the Homestake Creek option. Their scheme involved
capturing the diversion water from the tailings impoundment and
delivering via a 1700 m long penstock to a downstream
powerhouse. The cost of this scheme was estimated at C$31
million.
The
Homestake project area has historically been the source of five
hydroelectric schemes, producing 49 MW of power, including Anyox
dam and Kitsault Lake. The last of the projects was abandoned in
1935, however plans are underway to restore some of these historic
powerplants. The scheme includes:
■
The 7 MW Kitsault
storage dam project which was licensed in 2003
■
The West Kitsault
River project which was licensed in 2003
■
The 14 MW Homestake
Creek project which was licensed in 2003
■
And the 5 MW Trout
Creek project which was licensed in 2005.
Land
tenures have been granted for the powerhouses and switchyards, and
licenses have been obtained for diversion works and penstock
alignments.
It is
not known if or when these schemes will be made into reality
however the demand created by the construction of a mine could
influence the timeline.
18.3.3
Diesel Power Alternative
Based
on current fuel prices, diesel electric power is expected to cost
in the order of C$0.35 per kW-hr or C$25 million annually. This
does not include the capital cost of 8 MW of installed power, or
maintenance of the generators, which is expected to cost an
additional C$3 million. Based on these costs it can be seen that
the construction of a transmission line would be more cost
effective even in the short term.
18.4
Water Supply
The
Homestake project area has more than adequate local water
resources.
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18.5
Waste Rock Storage
The
mine will generate roughly 1.60 million tonnes of non-mineralized
waste rock over the life of the mine. Based on the preliminary ARD
testing the waste rock is expected to be a combination of non-acid
generating and potentially acid-generating.
Pre-production
development of the underground mine will require the excavation of
about 800 metres of access ramps from 3 portals. This will
generate roughly 60,000 tonnes of pre-production development waste
rock.
Some of
the non-acid generating waste is anticipated to be used for
construction fill at the mine portal benches, the tailings dam, the
plant site platform, and mine roads. Additional waste rock will be
generated by mining (internal waste). It is expected that most, if
not all, of the remaining waste rock will be used to backfill the
longhole stopes to support the mining.
18.6
Tailings Storage Facility
In 2011
Knight Piesold undertook a high-level assessment of potential sites
for the storage of tailings at the Homestake Ridge Project. Their
assessment was based on the assumption that all of the tailings
would need to be disposed on surface and no tailings would be
returned underground as backfill.
The
design basis for the Knight Piesold assessment was a mineable
resource of 4.9 million tonnes at a mill throughput of 1,500 tpd
for a 9 year mine life. It is further assumed that some
60,000 tonnes of waste rock will be produced and could be
available for construction of facilities.
Knight
Piesold noted that there had been no geochemical characterization
testwork on either the waste rock or tailings hence it was not
known if these materials would be acid generating or not. Any
non-acid generating (NAG) waste rock could be used as construction
materials, but potentially acid generating (PAG) rock would have to
be contained or disposed of sub-aqueously in the tailings storage
facility (TSF).
Knight Piesold assessment narrowed the choices down to 2 sites for
conventional slurried tailings disposal, and 2 sites for disposal
of tailings filter cake (dry stacking). The steep topography at the
project site limits the potential search area to sites south of the
proposed mine portals, and at the valley bottom. The four candidate
sites (sites A through D) are shown on Figure 18.3 below.
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Source:
Knight Piesold 2011
Storage Options
The
following text is excerpted from the Knight Piesold letter report
dated June 2011.
18.6.1
Slurried Tailings Options – Sites A and B
Slurry
tailings would be discharged from the mill circuit at an estimated
30 to 35 percent solids by mass of slurry and would flow by gravity
pipeline to the TSF. The slurry would be discharged through
multiple offtakes (spigots) from header pipes situated on the
embankment crest and around the periphery of the TSF to create low
angle beaches that slope away from the confining embankment to a
supernatant pond. The estimated lengths of tailings distribution
pipelines for Site A and Site B are 1,400 m and 1,800 m,
respectively.
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Supernatant
pond water would be reclaimed for use as process water in the mill.
The reclaim system would consist of either a fixed or floating pump
station at the TSF, a reclaim pipeline, and a holding tank or pond
at the mill site. The estimated lengths of reclaim pipelines for
Site A and Site B are 300 m and 900 m, respectively.
Conventional
slurry tailings are conservatively assumed to settle to a dry
density of 1.3 t/m3 for storage capacity
determination. Based on the 4.9 Mt resource, this equates to a
required tailings storage volume of 3.8 Mm3. The tailings would
be retained behind an earthfill embankment located across the
valley bottom at the downstream end of the facility. It is
anticipated that construction of a low permeability zoned
embankment may be impractical and a geomembrane liner system would
be installed on the upstream embankment face. The embankment would
be constructed with 2H:1V upstream and downstream slopes, a 15 m
ultimate crest width, and 5 m of freeboard to account for
precipitation runoff, wave run-up, and minimum operating freeboard
requirements. Embankment heights for Site A and Site B are
approximately 50 m and 70 m, and embankment volumes are estimated
to be 0.6 Mm3 and 1.6
Mm3,
respectively.
case of Sites A and B, large upstream catchment areas (21.7 km2 and
24.4 km2, respectively), as shown on Figure
18.3 and the high estimated annual precipitation in the project
area result in large projected volumes of water that would require
diversion around the TSF to prevent large discharges of untreated
TSF effluent to the downstream environment. Diversion of these
flows would be achieved by constructing a flood attenuation dam on
Homestake Creek upstream of the TSF and constructing a diversion
channel around the perimeter of the facility that discharges back
to the natural stream below the TSF. The flood attenuation dam
would serve to reduce peak stream flows thereby reducing the
diversion channel capacity requirements. The diversion channel
would need to be well maintained throughout the year to ensure that
the accumulation of snow or debris would not impact or prevent
stream diversion leading to increased inflow to the
TSF.
A water
treatment plant would be required to ensure that water quality
standards are met for water releases from the TSF.
Closure
of the slurry tailings facility would likely involve
decommissioning of the diversions, constructing a waste rock cap on
the tailings surface, establishing a closure lake, and constructing
a permanent spillway.
18.6.2
Filtered Tailings Options – Site C and Site D
Dewatering
of the tailings slurry may be used to remove process solutions and
develop a partially saturated filter cake at the mill that is
estimated to be 85 percent solids by mass. With an estimated
compacted in-situ dry density of 1.6 t/m3, the filtered
tailings would require a site with capacity for roughly 3.0
Mm3. Two
alternatives for the dry stack technology have been
assessed:
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■
Site C: Side-hill
dry stack site located adjacent to Plant Site 2 with an elevation
range of 700 m to 800 m, on an average natural slope of
roughly 10 to 20 percent. This site has capacity for the full
tailings volume, but is situated on moderately steep terrain for
which the stability has not been assessed.
■
Site D: Dry stack
site located on a flat to mildly sloping topographic bench on the
west side of the Homestake Creek valley in an elevation range of
970 m to 1010 m, roughly 3 km from Plant Site 2 by conceptual
road alignments. Site D occupies an area presently covered with
small lakes and bogs.
Foundation
preparation would involve dewatering of lakes, installation of
foundation drains, and removal of unsuitable foundation soils prior
to construction of the dry stack facility.
locations that have been identified for dry stack disposal are
shown on Figure 18.3,The dry stack
tailings options are considered as mine development concepts using
Plant Site 2 as the preferred location for the mill.
The
filtered tailings would be transported by truck, rather than
conveyor systems, from the mill to the deposition site. Truck
transport is considered to be simpler and more flexible and
economically viable for the Homestake Ridge Project and has been
assumed as the base case for the cost estimates. Tailings solids
would be spread by dozer and compacted with a vibratory roller at
the dry stack.
3H:1V
slopes buttressed against the hillside are assumed for the dry
stack. With the addition of cement and additional stability
buttressing with waste rock, steeper slopes may be developed. The
dry stack will have small confining embankments on the downhill
side of the facility, and diversion ditches on the upstream side to
divert the uphill catchment area. The slopes of the dry stack will
be capped with waste rock as the facility expands as part of a
progressive reclamation strategy. Seepage controls would be
required for the dry stack option and may be integrated with a
stormwater runoff events pond.
The key
benefit of implementing Site C or Site D for the Homestake Ridge
Project is in minimizing the surface water management design
requirements and associated costs. Filtered tailings may be a good
option for the Homestake Ridge Project because of the recent water
management issues associated with slurry tailings
disposal.
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18.6.3
Site Selection
a site inspection by Knight Piesold in October of 2011, Site A was
selected as the preferred option on the basis of the site
topography, avalanche risks, availability of borrow materials, and
the earthwork volumes for construction. The proposed site
development plan is shown on Figure
18.3 above.
18.7
Process Plant
Several
locations have been identified for locating the process plant at
the Homestake Ridge site. The alternatives were reviewed by Knight
Piesold in 2012 on the basis of site topography, haul distance from
the mine portals, distance to the tailings storage facility, and
site elevations. This engineering is ongoing.
18.8
Ancillary Facilities
18.8.1
Person-Camp
Due to
the remote location of the project area, the project would likely
operate on a DIDO roster with accommodation in a person-camp. The
camp would be sized to accommodate crews on two or three shifts
without a need for hot-bedding (sharing beds). The camp would
include a mess hall, a fitness area, a first aid room, and a lounge
with access to WiFi and satellite TV. Each room would have its own
access to an ensuite bathroom. The camp would include a VIP area
for visiting management and guests.
18.8.2
Core Shack
The
core shack would consist of a heated pre-fabricated portable
trailer with adjacent core storage in pre-fabricated racks under a
tin roof cover.
18.8.3
Assay Laboratory
The
assay laboratory would consist of two pre-fabricated trailers or
sheds connected with a covered walkway. The first trailer would be
dedicated to sample preparation and would consist of sample
crushing, screening and sample splitting, with a pulverizer. The
second trailer would house the fire assay laboratory, wet
chemistry, analytical equipment, scales and balances and a small
office. The buildings would be supplied with air conditioning with
filtration/dust collection, fume scrubbing, and
propane.
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18-9
18.8.4
Maintenance Shop and Warehouse
The
maintenance shops and warehouse would consist of rigid frame fabric
buildings on a concrete pad. The buildings would be furnished with
propane heat, ventilation, and air filtration/dust
collection.
18.8.5
Mine Administration/Technical Offices
The
office building(s) would consist of pre-fabricated ATCO style 20×40
or 20×60 foot office trailers parked on a compacted gravel pad. The
trailers would house the mine administrative and management staff,
technical services such as geology and engineering, and
purchasing.
18.8.6
Underground Dry
The
underground dry would consist of a heated pre-fabricated ATCO style
trailer on a compacted gravel pad. An adjacent or connected trailer
would house the shower and restroom facilities.
18.9
Storage
18.9.1
Diesel Fuel
Diesel
fuel would be stored in a bunded containment strategically located
near the mine portal for refueling equipment and
generators.
18.9.2
Potable Water
Potable
water is expected to be sourced from a clean water source on the
project site and pumped to potable water tanks near the
camp.
18.9.3
Fire Water
A fire
water tank must be located at a strategic location to provide fire
suppression at the mill, at the person camp, and to the mine
portals. This system will provide 60 minutes of fire water by
gravity at a flow rate of 1,500 gpm or as otherwise required by
Provincial fire safety guidance or insurance
requirements.
18.9.4
Explosives
An
explosives magazine will be located near the mine portals in
accordance with Provincial mine regulations. This magazine will be
supplied by the explosive vendor.
18.9.5
Reagents
Mill
reagents will be stored in secure storage either at the
metallurgical plant, or in the warehouse, depending on provincial
regulations and mine requirements.
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19.
MARKET STUDIES AND CONTRACTS
The
Homestake Ridge Project will produce a clean copper concentrate
with elevated gold values, a lead/zinc concentrate with silver
values, and doré bar. The intention is to sell the
concentrates to a metals or concentrate buyer, while the doré
will be sold directly to a precious metal refiner.
At the
time of writing this report, Auryn had not entered into any
material contracts for the sale of concentrates or
doré.
19.1
Commodity Pricing
prices used in the financial models in this document are based on a
3-year lookback at commodity prices as summarized in Table 19-1 and Figure
19.1 and Figure 19.2 below. The
1-yr, 2-yr and 3-yr prices reflect the actual spot prices looking
back those years. The 3-yr average is the 3-yr moving average
effective March 26, 2020.
Historical Metal Prices effective March 26, 2020 – US
Dollars
| | | | | |
Gold | $1,473.25 | $1,305.60 | $1,313.85 | $ | |
Silver | $ | $ | $ | $ | |
Copper | $ | $ | $ | $ | |
Lead | $ | $ | $ | $ | |
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19-1
Source:
www.denvergold.org
Trends for Gold (top) and Silver (bottom)
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19-2
Figure 19.2: 3-Year Historical Price Trends for Copper
(top) and Lead (bottom)
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19-3
In
accordance with BCSC and SEC guidelines, the authors have used the
3-yr moving average price as guidance for the metal pricing in this
study (see Table 19-1). Accordingly, the following metal prices (US
Dollars) have been adopted:
The
slightly elevated price for gold is justified on the basis of the
current spot price and the continued trend of increasing gold
prices from October 2018 (excepting the recent collapse in metal
prices due to the COVID-19 virus).
19.2
Material Contracts
The
Company has not entered into any material contracts for
construction or operations including supplies, services or capital
equipment
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19-4
20.
ENVIRONMENTAL STUDIES,
PERMITTING, ANDSOCIAL OR COMMUNITY
IMPACT
20.1
Environmental Studies Overview
The
Homestake Ridge property is located on the south-west edge of the
Cambria Ice Field. The southern portion of the claim group is
located at the headwaters of an eastern unnamed tributary to the
Kshwan River that discharges into the Hastings Arm of Observatory
Inlet. The central claim group, which contains the main mineralized
zone is located at the headwaters of Homestake Creek. This
environmental study summary focusses on the Homestake Ridge
Project, consisting of the three primary deposits: Homestake Main,
Homestake Silver and South Reef Zones, together with the proposed
waste management facilities (tailings dam, tailings facility,
runoff diversion dam), plant site and access road from Alice
Arm.
Environmental
programs conducted to date, and summarized herein,
include:
■
Wildlife Surveys for Kitsault/Homestake/Trout
Creek Hydroelectric Projects. Prepared for Kitsault Hydro
Electric Corporation, Richmond, BC. Prepared by Ken Wright &
Sean Ebnet. N.D.
■
Assessment Report 1994 Baseline Environmental
Studies on the Kitsault Claim Group. Report by Mike Sieb.
February 25, 1995.
■
1994 Environmental Studies at Kitsault
Lake. Prepared for Lac Minerals, Vancouver, BC. Prepared by
Rescan Environmental Services Ltd., Vancouver, BC. February
1995.
■
Homestake Creek Hydroelectric Project
Fisheries Investigations; Habitat Assessment; IFR
Recommendation. Prepared for Department of Fisheries and
Oceans, Prince Rupert, BC. Prepared by EES Consulting, Inc.
December 2004.
■
Homestake Ridge Project – Gap Analysis
and Biophysical Review. Prepared for Allnorth Consultants
Ltd., Prince George, BC. Prepared by Triton Environmental
Consultants Ltd., Terrace, BC. November 10, 2011.
■
Homestake Ridge Project Proposed Road Stream
Assessment. Prepared for Allnorth Consultants Ltd., Prince
George, BC. Prepared by Triton Environmental Consultants Ltd.,
Terrace, BC. January 20, 2012.
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20-1
■
Homestake Ridge Project Surface Water Quality
Initial Site Visit Report. Prepared for Allnorth Consultants
Ltd., Prince George, BC. Prepared by Triton Environmental
Consultants Ltd., Terrace, BC. February 10, 2012.
■
Homestake Ridge Mineral Exploration Project
Management Plan for: Grizzly Bear, Mountain Goat, Moose, Coastal
Northern Goshawk, and Marbled Murrelet. Prepared for Auryn
Resources Inc. Prepared by One-Eighty Consulting Group. July 10,
2018.
Publicly
accessible data has also been used from the following
sources:
■
Publicly available
data generated by DataBC. Accessed via iMapBC.
■
Water Survey of
Canada Data for Station 08DB011, “Kitsault River Above
Klayduc Creek”, 1981 – 1996.
A list
of other referenced documentation is provided in Section
27.
20.2
Pre-Existing Conditions
The
Homestake Ridge Project area is a greenfield site with no previous
development or pre-existing environmental issues.
20.3
Waste Rock Characterization
Six
waste rock field barrel kinetic tests were undertaken in 2012 by
pHase Geochemistry of Vancouver to provide an assessment of the
waste rock pore water quality under site conditions. Splits of the
barrels were sent to SGS in Burnaby, BC for further
analysis.
The
waste rock samples were collected from drill cores stored at the
company core storage yard in Prince Rupert, BC. Roughly 100 to 120
m of composited quartered core from the Homestake Main deposit was
selected for analysis.
Six
major rock types were sampled:
■
PC –
polymictic conglomerate
■
MSB – monomictic
sedimentary breccia
■
LF –
fragmented latite flow
■
XF – massive
latite flow
■
GW – footwall
wacke
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20-2
The
sample mineralogy was determined by XRD analysis. The principle
minerals include quartz and muscovites with lesser amounts of
plagioclase, clinochlore, calcite and in some samples
K-feldspar.
The
carbonate mineralogy consists of minor calcite (0.3 to 16 percent)
and ankerite/dolomite as well as traces of siderite.
The
sulphide mineralization consists of pyrite which was present in all
of the samples (except the conglomerates) in varying proportions
from trace to 10 percent in the latite flows. The pyrite occurs as
disseminated fine eu-anhedral grains and patchy aggregated grains.
The samples contain trace amounts of chalcopyrite, sphalerite and
pyrrhotite.
The
Acid-Base Accounting (ABA) results show that 3 of the 6 barrels
(PC, DF, MSB) were non-acid generating (NAG), two were determined
to be PAG (XF and GW), and one was labelled uncertain (LF). The two
PAG samples contained 7.2 and 8.6 percent pyrite respectively, with
5.1 and 10.9 percent calcite respectively. The uncertain
sample contained 3.2 percent pyrite with 0.3 percent
calcite.
20.4
Tailings Geochemistry
A
preliminary geochemical assessment of tailings was carried out by
SGS in 2011. Two locked-cycle flotation tailings samples were
provided: LCT-2 from the Homestake Ridge Project; and LCT-4 from
the Silver Cap deposit. The test program included ICP-OES/MS strong
acid digestion elemental analyses, shake flask extractions,
humidity cell testing, and bioassay testing with fish
species.
The
acid digestion elemental analyses indicated that both samples were
predominantly comprised of silica and with significant levels of
Al, K and Fe as would be expected for feldspar
minerals.
The
LCT-2 sample was found to be net neutralizing due to the presence
of fast reacting carbonate minerals. Humidity cell testing on LCT-2
likewise confirmed the leachates to be near neutral to slightly
alkaline. The bioassay tests with decant solutions from LCT-2 were
reported to be non-lethal.
The
LCT-4 sample, on the other hand, was found to be acid generating
and produced a low final pH value of 2.49.
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20.5
Metals Leaching
ICP
scans on solids from the kinetic test samples showed elevated
levels of arsenic in 3 samples (MSB, LF and XF), and trace amounts
of selenium.
20.6
Environmental Considerations/Monitoring
Programs
20.6.1
Waste Rock Monitoring
The
project is not expected to generate any significant volumes of
waste rock that will be stored on surface. During mine operations,
metal leaching/acid-rock drainage (ML/ARD) characterization of the
waste rock will be conducted at regular intervals to appropriately
classify the waste rock as PAG or non-PAG. All of the non-PAG waste
will be incorporated into construction of the facilities such as
the tailings dam, roads, portal benches and plant site grading. The
remaining waste rock will be temporarily stored on surface, and
subsequently used underground for backfilling of
stopes.
20.6.2
Tailings Surface Water Management
The TSF
will store tailings generated from the milling process, water
stored in the voids of the tailings, additional water collected
from runoff upstream of the TSF in the TSF catchment, and
precipitation (e.g., rain and snow) that falls directly on the TSF.
Water collected in the TSF may be re-used in the milling process to
reduce the volume of water required to be input into the process.
However, the volume of water stored in the TSF is expected to be in
excess of the process requirements and will likely require
treatment in a water treatment plant prior to discharge. Water
treatment systems will be designed to manage the site-specific
geochemical signature of the waste rock and tailings and will meet
effluent discharge requirements detailed in subsequently received
mine operating permits.
Design
of the TSF water management and water treatment process will
proceed following advanced geotechnical investigations and
refinement of the mine plan and waste management
strategy.
20.6.3
Groundwater Monitoring
Groundwater
monitoring for water levels and water quality will be conducted at
stations both upstream and downstream of project infrastructure.
Baseline data collection will be conducted prior to construction to
acquire background information, for which to compare water levels
and water quality data collected during mine operations and
post-closure. Specific stations and monitoring frequencies will be
determined during Environmental Assessment and Mines Act Permit
approval processes.
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20.6.4
Surface Water Monitoring
Hydrological
and water quality monitoring will be conducted at creeks around the
project site. Water monitoring stations will be established on
upper and lower Homestake Creek and potentially on adjacent creeks,
to provide un-impacted reference stations. Monitoring on Kitsault
River may also be conducted to evaluate downstream conditions.
Baseline hydrological and water quality data will be collected
prior to construction to characterize the existing conditions.
During construction and operations, regular hydrological and water
quality monitoring will be conducted to monitor for potential
impacts on the receiving environment. Monitoring may be continued
following the cessation of mining activities, should mine
infrastructure (e.g., TSF) remain on-site. Specific stations and
monitoring frequencies will be determined during Environmental
Assessment and Mines Act Permit approval processes.
20.6.5
Surface Runoff Water Management
The
project site is located in an area of relatively high precipitation
and high snowfall with steep terrain. The intent of the site water
management plan will be to divert upland runoff around the proposed
facilities whenever possible to keep the clean water clean, and to
collect and treat water impacted by mining activities. Diversions
will be used to prevent clean upstream runoff water from entering
mine facilities such as the TSF, the plant site, and the mine
portals. To divert the large catchment area upstream of the TSF, a
flood attenuation dam on upper Homestake Creek would be
constructed, that will serve to reduce peak stream flows and
thereby reduce the diversion channel capacity requirements. A
diversion channel would then carry the clean water around the
perimeter of the TSF and discharge back to the natural stream below
the mine infrastructure.
Runoff
from disturbed ground such as the mine portal benches, the plant
site, roads and parking areas will be directed to sediment
collection basins to remove any suspended solids before
discharge.
Mine
impacted water (i.e., from the underground mine), and surplus water
accumulated in the TSF, will be treated in the water treatment
plant prior to discharge.
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20.7
Closure Plan
Mine
closure requirements in British Columbia are regulated by the Mines
Act and the accompanying Health, Safety and Reclamation Code for
Mines in British Columbia (MEMPR, 2017b). During an application for
an authorization under the Mines Act, proponents are required to
submit a conceptual reclamation plan for the closure of all aspects
of the mining operation, including:
■
Plans for long term
post-closure maintenance of facilities
■
Proposed use and
capability objectives for the land and watercourses
■
A closure plan for
the TSF.
As
Mines Act and Environmental Management Act permit applications are
often submitted jointly, using the same information package, the
MOE and MEMPR have issued a guidance document that further details
requirements for reclamation planning and effective mine closure
(MEMPR & MOE, 2016) which includes:
■
End land use and
capability objectives
■
Reclamation
approaches
■
Trace element
uptake in soils and vegetation
■
Disposal of toxic
chemical
■
Contaminated site
requirements
■
Groundwater well
decommissioning
■
Detailed five-year
mine reclamation plan
■
Conceptual final
reclamation plan
■
Reclamation cost
estimate.
The
reclamation cost estimate includes the total expected costs of
outstanding reclamation obligations over the planned life of the
mine, including the costs of long-term monitoring and maintenance.
Financial security is required to be provided for the outstanding
costs associated with the mine reclamation, and can be provided by
certified cheque, irrevocable standby letters of credit, guaranteed
investment certificates with up to three-year terms backed by a
safekeeping agreement (for security less than C$25,000), surety
bonds, or by money placed in the reclamation fund.
Under
the current exploration permit MX-1-603, security held by MEMPR
totals C$68,000.
Closure
costs for the proposed mine project have been estimated at C$5
million.
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20.8
Permitting
Current
exploration activities are permitted under Mines Act permit
MX-1-603, through to March 31, 2023. The Mines Act permit
approves the construction of a camp, geophysical survey with
exposed electrodes, surface drilling (500 drill holes), helipads
and exploration trails.
The
construction of the Homestake Ridge Project will require additional
permits, following the receipt of an Environmental Assessment
Certificate under the Environmental Assessment Act required for
mining projects with an ore extraction rate ≥75,000
tonnes/year (OIC 607/2019). The project will not require a federal
review under the Impact Assessment Act as it does not exceed a
material production capacity of 5,000 tpd (SOR/2019-285) (proposed
production is 900 tpd).
The
project is located within the boundaries of several land use plans,
which generally limit land use for commercial timber purposes, but
do not restrict mining activities. These land use plans, as well as
the relevant federal, provincial permits and authorizations, and
details of the required access road permits are detailed in the
following sub-sections.
20.8.1
Land Use Plans
project is located within the North Coast Land and Resource
Management Plan (North Coast LRMP), a land and resource management
plan established in 2005 (BC MSRM, 2005), which was subsequently
incorporated into law through the Great Bear Rainforest (Forest
Management) Act in 2016 (BC Reg 324/2016). Specifically, the main
project activities are located in the Kitsault Special Forest
Management Area, with the southern most part of the mineral claim
boundary extending into the Kswan Biodiversity, Mining and Tourism
Area (Figure 20.1).
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20-7
Homestake Ridge Project
NI43-101F1
Technical Report
Land Use Zones
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20-8
Homestake
Ridge Project
NI43-101F1
Technical Report
These
areas are designated under the Great Bear Rainforest Act through
the Great Bear Rainforest (Special Forest Management Area)
Regulation (BC Reg 325/2016, OC 971/2016). Special Forest
Management Areas prohibit commercial timber harvesting in the area
(FLNRORD, 2016), but does allow hydroelectric power generation,
mining and tourism development “as long as it maintains
ecological integrity” (Province of British Columbia, 2019).
Biodiversity, Mining and Tourism areas further prohibit use by both
commercial forestry and hydroelectric generation operations
(Province of British Columbia, 2019).
The
Nass Valley, and the north-eastern portion of the Homestake Ridge
mineral claim block, is subject to the Nass South Sustainable
Resource Management Plan (Nass South SRMP; FLNRORD, 2012). The Nass
South SRMP is an outcome of both the Gitanyow Recognition and
Reconciliation Agreement and a partnership with the Nisga’a
Lisims government. The Nass South SRMP incorporates into law the
Gitanyow Lax’Yip Land Use Plan (Gitanyow Nation and the Province of
British Columbia, 2012).
mineral claim block overlaps with one old growth management area in
the north east corner of the claim area as well as some high and
moderate Goshawk fledging nesting post habitat, and portions of the
ecosystem network (Nass South SRMP Figure
20.2). Ecosystem networks focus mainly on the retention of
important communities (including listed plant communities),
ecosystem structure and successional stages, and maintenance of
appropriate landscape patterns. Resource management can occur in
established ecosystem networks, provided biodiversity goals and
objectives are not compromised (Gitanyow Nation and the Province of
British Columbia, 2012). While the Nass South SRMP is focused on
timber development and does not currently regulate or define
requirements related to mineral exploration and development, it is
useful to note that the proposed project area is defined as a low
biodiversity landscape unit, is not identified for any visual
quality objectives, and is not near any protected
areas.
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Resource Management Plan Areas
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20.8.2
Federal Permits, Approvals, Licences and
Authorizations
detailed above, the project does not require a federal review under
the Impact Assessment Act; however, several federal authorizations,
permits and licences will be required. A list of potentially
applicable federal authorizations and permits and the corresponding
responsible agency, federal statute and project activity is
provided in Table 20-1.
Federal Permits and Approvals Potentially Applicable to the
Project
| | | |
Authorization | Fisheries | Fisheries | Conducting |
Migratory | Migratory | Environment | Deposit |
Species | Species | ECCC, | Authorizes |
Explosive | Explosives | Natural | Explosive Explosive |
Transportation | Transportation | Transport | Related |
Storage | Canadian | ECCC | For the |
Ammonium | Railway | Canadian | For an |
Spectrum | Radiocommunication | Innovation, | For the |
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20.8.3
Provincial Permits, Approvals and Licences
The
project is located on Crown land, through a combination of mineral
claims and five Crown Grants. The three primary provincial
authorizations required to build, operate and reclaim the project
are:
1.
An environmental
assessment (EA) certificate, issued under the Environmental
Assessment Act by the Environmental Assessment Office
(EAO)
2.
Permits issued
under the Mines Act by the MEMPR
3.
Waste discharge
permits issued under the Environmental Management Act by the
Ministry of Environment and Climate Change Strategy
(MOE).
A
mineral lease will also be required to convert mineral claims
(allowing for exploration and development of mineral resources with
production limits) to a mining lease (to engage in mine production
and/or mine reclamation subsequent to production) (MEMPR, 2017a).
To apply for a mining lease, a mineral claims holder applies to
have the mineral claims replaced with a mining lease under Section
42 of the Mineral Tenure Act (MEMPR, 2017a).
are also several minor permits and authorizations required to
construct and operate a mine in British Columbia. A list of
potentially applicable provincial approvals and permits and the
corresponding responsible agency, provincial statute and project
activity is provided in Table
20-2.
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Provincial Permits and Approvals Potentially Applicable to the
Project
| | | |
Environmental | | EAO | Conducting |
Mines | | MEMPR | Approval |
Waste | | MOE | Permitting |
Heritage | | Ministry | Heritage |
| | FLNRORD: | Assessment |
| | MOE: | Wildlife |
Construction | | BC | Groundwater |
Water | | BC | Construction |
Drinking | | BC | Operation |
Short | | MOE: | Short-term |
| | FLNRORD | For |
Water | | FLNRORD | For |
Licences | Licence Provincial | FLNRORD: | Licence Special |
Industrial | | Ministry | Required |
Permit | | Ministry | Regulated |
Hazardous | | MOE | A |
Sewage | | MOE | Registration |
Food | | Provincial | To |
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20.8.4
Access Road Permitting
The
vicinity of the project is accessible by the Kitsault River Road, a
35 km road that leaves Alice Arm and heads north. The Kitsault
River Road is a combination of public road (first ~28 km),
maintained by the Ministry of Transportation and Infrastructure
(MoTI), and ~7 km of resource road, that provides access to the
past producing Dolly Varden silver mine. The current trail ends
approximately six kilometres short of the project
area.
Permitting
for the access road would be combination of a MoTI permit on the
public road, and a special use permit for the remaining 13 km
issued by FLNRORD. A road use agreement may also be required if
there is an existing permittee for the section of road that travels
through the Dolly Varden claims. Construction of access routes
within the Homestake mineral claims would be covered under Mines
Act permit and authorizations.
20.9
Considerations of Social and Community Impacts
The
project is 35 km by road from the towns of Kitsault and Alice Arm.
Alice Arm is home to a few summer residents, but no year round
residents. While the Kitsault townsite and the surrounding 80 ha
was purchased in 2005 by a private land-owner and has been
maintained at a cost of approximately $1M per year, the town is
closed to the public, and only caretakers and summer maintenance
crews currently reside there (EAO, 2013).
The
nearest populated towns are the Nisga’a communities along the
Nass River valley: Gitlaxt’aamiks (New Aiyansh) (1,800
residents); Gitwinksihlkw (250 residents); Laxgalts’ap
(520 residents); and Gingolx (500 residents). The communities
of Prince Rupert (340 km by road south-west), Terrace (185 km
south) and Stewart (240 km by road, north-west) would have a
reasonable likelihood of providing labour, goods, and services to
the Project.
The
project overlaps with one licenced guide outfitter territory, four
traplines, two commercial recreation licences of occupation and one
tenure licence for water power investigation. The mineral claims
represent only 0.3 percent (7441 ha) of the total outfitting
guiding area (2,670,179 ha), and less than 8 percent of any of the
four traplines.
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There
is one water rights licence issued to the Kitsault Hydro Electric
Corporation on Homestake Creek, just above the confluence with the
Kitsault River. Kitsault Hydro Electric Corporation had proposed a
run of the river project on Homestake Creek, together with two
other run of the river projects on the West Kitsault River and
Trout Creek and re-instatement of the Kitsault dam at the outlet of
the Kitsault Lake in 2003 (CEAA, 2012). Water licences were issued
for the Kitsault Storage Dam, West Kitsault River, and Homestake
Creek projects in 2003, and in 2005 for the Trout Creek project
(Anyox Hydro, 2013). While Kitsault Hydro Electric Corporation
conducted substantial upgrades to the all-weather access road in
2004/2005 and again in 2014, no activities have occurred since
(Dolly Varden Silver Corp, 2014), and the rights are owned by the
same private land owner that owns the Kitsault
townsite.
Four
different Indigenous groups assert interests overlapping the
Homestake Ridge Project mineral claims: Nisga’a Nation,
Gitanyow Hereditary Chiefs Office, Tsetsaut Skii Km Lax Ha Nation
and the Metlakatla Band Council. While the main project
infrastructure is in the treaty lands of the Nisga’a Nation,
the northern mineral claims are adjacent to the Gitanyow House
Gwass Hlaam and Biitoosxw group, and the southern-most portion of
the primary mineral claim block (1015450) is within the Metlakatla
Band Council Traditional Territory.
Following
early ethnohistoric research in order to identify Indigenous groups
with potential interests in the project area, Auryn has identified
that the two primary potentially affected Indigenous groups are the
Nisga’a Nation and the Gitanyow First Nation.
The
Nisga’a Nation is a self-governing treaty nation with rights
under the Nisga’a Final Agreement, signed in 1998. The
population of the Nisga’a Nation is approximately 6,700
people – 1,900 Nisga’a citizens live in four villages
on Nisga’a Lands and another 4,800 Nisga’a citizens
live elsewhere, including Prince Rupert, Terrace and Vancouver. The
proportion of young people living on Nisga’a Lands is
significantly higher than the provincial average.
The
Nisga’a are governed by the Nisga’a Lisims Government,
with an executive (President, Executive Chairperson,
Secretary-Treasurer and CEO) and government departments, serving as
the representative body for administration and consultation
purposes. The Nisga’a Employment, Skills, and Training
organization (NEST), is the primary organization coordinating
employment and training opportunities for Nisga’a
citizens.
Among
others, the Nisga’a Final Agreement defines both treaty
rights for natural resource extraction, such as fishing and
harvesting aquatic plants, migratory birds, and wildlife, and
ownership of lands. Land ownership includes both Category A Lands,
which afford direct land ownership, and Category B fee simple
lands. The Homestake Ridge mineral claim block falls within an area
covered by both the Nass Wildlife Area and the Nass Area as defined
in the Nisga’a Final Agreement, which provide treaty rights
to the Nisga’a Nation for fishing and harvesting aquatic
plants, migratory birds, and wildlife. There is one parcel of
Category B Lands on the southeast side of Kitsault
Lake.
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While
centrally located in the Nisga’a Lands, the project is also
adjacent to two Gitanyow Hereditary House groups (wilps): Gwass
Hlaam & Biitoosxw, and Luuxhon, that have House territories
north of Kitsault Lake where they assert Aboriginal rights
including title. Luuxhon territory boundaries do not appear to
directly overlap with any of the company’s mineral claims.
The Gwaas Hlaam & Biitoosxw house boundary does slightly
overlap with the northern portion of the mineral
claims.
The
Gitanyow are part of the Gitxsan, a division of the Tsimshian.
Their hereditary system concentrated most control of and rights to
land and resources in Houses (wilp). The current principal
village/community of the Gitanyow is in the Skeena watershed on the
Kitwanga River, on Highway 37, approximately 140 km northeast of
Terrace, but most of their asserted territory is in the Nass
watershed, and includes the White River region. There are around
1,800 members. Almost half of the registered population live on the
main reserve.
The
Gitanyow mainly observe a hereditary governance system, and they
have eight houses (wilp), each represented by a hereditary chief.
The wilp is the primary unit of Gitanyow governance,
decision-making, and jurisdiction over land and resources, and is
headed by a hereditary chief. Wilp territories are generally
defined by a specific watershed or group of watersheds. There is an
elected chief and council mainly responsible for the administration
of and day-to-day affairs of the main Gitanyow reserve community.
The Gitanyow Hereditary Chiefs’ Office is the governing body
with respect to Gitanyow traditional territory and the assertion of
Gitanyow rights.
The
company engaged early and repeatedly with the Nisga’a Nation
and the Gitanyow First Nation commencing in January and April 2017,
respectively, in order to provide corporate and project
information, share plans, updates, and provide each of these groups
with opportunities for feedback and involvement in the project.
Draft mineral exploration permit applications and supporting
materials were provided to the Nisga’a Nation and Gitanyow
First Nation in advance of submission to government.
Auryn’s
local engagement philosophy supports the delivery of shared
prosperity to Indigenous communities including:
■
provision of jobs
and training programs
■
contracting
opportunities
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■
capacity funding
for First Nations engagement
■
sponsorship of
community events.
Approximately
40 percent of Auryn’s Homestake Ridge Project team since 2017
have been local Indigenous members and two of the primary
contractors were local Indigenous owned companies.
Auryn
and the Nisga’a Lisims Government entered into a
Confidentiality Agreement in January 2020.
20.10
Comments on Section 20
The
authors are not aware of any environmental, social or permitting
issues not disclosed herein that could have an impact on project
development.
Further
advancement of the Homestake Ridge Project will require additional
environmental baseline and geochemical testing. In particular
additional studies are needed to:
■
characterize the
geochemical stability of the waste rock and tailings
■
assess surface
water geochemistry
■
assess groundwater
geochemistry.
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21.
CAPITAL AND OPERATING COSTS
21.1
Capital Cost Estimates
21.1.1
Basis of Estimate
Capital
costs for the Homestake Ridge Project include engineering,
procurement, construction and commissioning of a 900 tonne per day
underground mine, metallurgical plant, and ancillary facilities
such as the access road, site roads, powerline, tailings facility
and a person camp.
The
capital costs herein have been developed at a level consistent with
a scoping level assessment of the economic viability of the
project. The estimate has largely been developed from benchmarking
of costs from recent projects of a similar scope and similar size.
Data from the benchmarking was derived both from MineFill files,
and from recently published PEA’s. Costs are benchmarked to
Q4 in 2019 and are considered accurate to ± 25 percent. All
costs have been converted to US dollars at an exchange rate of
C$1.00 to US$0.70 unless indicated otherwise.
21.1.2
Direct Costs
pre-production capital cost has been estimated at US$88.4 million
(C$126.3 million) including all direct and indirect costs. The PEA
is based on contractor owned and operated equipment and manpower. A
contingency of 15 percent has been applied to all direct facility
costs. Details of the pre-production capital are shown on Table 21-1 below.
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21-1
Capital Cost Summary
| |
Direct |
|
Mining | $3.01 |
Surface | $3.50 |
Tailings | $8.40 |
Site | $6.30 |
Camp | $3.15 |
Site | $3.50 |
Power | $8.40 |
Process | $26.18 |
Access | $2.10 |
| |
Indirect |
|
EPCM | $8.70 |
Owner | $5.80 |
Environmental | $0.64 |
Contingency | $8.70 |
| |
| |
21.1.2.1
Mine Fleet Capital Costs
The
mining fleet costs (US$6.5 million) were largely derived from
estimated costs for a contractor owned and operated underground
fleet. These costs would include drill jumbos, load-haul-dump
units, underground trucks, and supporting vehicles such as ANFO
loaders, bolters, and light vehicles. The surface fleet would
consist of a small fleet of articulated trucks for ore haulage to
the metallurgical plant, graders and light vehicles.
21.1.2.2
Tailings Facility
The
tailings facility costs (US$8.4 million) were estimated by Knight
Piesold in 2012 based on preliminary designs, volumes, quantity
take-offs and contractor costs. These costs have not been escalated
herein.
21.1.2.3
Site Development
The
site development costs of US$6.3 million were estimated by MineFill
and include site roads, grading, airstrip, water diversions and
water management.
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21.1.2.4
Camp
The
camp costs were estimated on the basis of a 150 person camp at
C$30,000 per room.
21.1.2.5
Site Infrastructure
Site
infrastructure costs were largely estimated by Knight Piesold based
on detailed estimates and recent construction costs. These costs
include power distribution, water supply, sewage, and mine services
such as ventilation and compressed air.
21.1.2.6
Power Supply
Power
supply costs were estimated by Knight Piesold in 2012 as outlined
in Section 18.
21.1.2.7
Process Plant
The
process plant capital estimate is based on recently published
studies for projects of a similar scope and similar
size.
21.1.2.8
Site Access
Capital
estimates for upgrading the site access, including a barge landing
in Alice Arm, were derived by AllNorth Consultants, Knight Piesold,
and Golder in several independent studies.
21.1.3
Indirect Costs
21.1.3.1
EPCM
Engineering,
procurement, and construction management costs are estimated at 15
percent of the direct facility costs.
21.1.3.2
Owners Costs
Owner
costs include owner project management, travel, capital raising and
corporate overheads. These costs are estimated at 10 percent of the
direct facility costs.
21.1.3.3
Environmental/Permits
initial and ongoing environmental monitoring and baseline data
requirements are shown in Table 21-2
below.
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21-3
Environmental Monitoring Costs (C$)
| | |
| | |
| | |
| | |
|
|
|
– Set up and year 1 of testing | | |
– Subsequent years of analysis | | |
| | |
| | |
| | |
| | |
| |
|
| |
|
21.1.3.4
Contingency
A
contingency of 15 percent has been applied to all direct costs for
plant equipment and facilities.
21.1.4
Sustaining Capital
costs have been estimated at US$85.8 million after a US$3.5 million
credit for the end-of-mine salvage value as summarized in Table 21-3 below.
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21-4
Sustaining Capital Costs – Life of Mine
| |
Mining | $2.11 |
Surface | $2.49 |
Capitalized | $66.35 |
Reclamation | $3.50 |
Closure | $3.50 |
Water | $1.40 |
End of | ($3.50) |
Contingency | $9.95 |
| |
21.1.4.1
Mining Equipment
The
sustaining capital estimate includes US$4.6 million for equipment
rebuilds and equipment replacement.
21.1.4.2
Capitalized Underground Development
The
majority of the sustaining capital is allocated to capital
development in support of the underground mining operations. This
includes level development, access drives and ore drives not
included in the stope mining costs. These costs are estimated at
C$3250/m for a 20 m2 drive which equates
to roughly C$60/tonne.
Vertical
development has been costed at C$6,000 per vertical metre for a
3.1 m diameter raise bore or roughly C$300 per
tonne.
21.1.4.3
Reclamation
The PEA
sustaining capital includes C$5 million for ongoing reclamation of
the TSF.
21.1.4.4
Water Treatment
The PEA
mine development plan includes C$2 million for construction of a
water treatment plant for treating mine water and tailings contact
water.
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21.2
Operating Cost Estimates
costs were developed from unit rate costs and benchmark costs for
projects of a similar size and scope. The all-in operating costs
have been estimated at US$89.40 per tonne milled and the breakdown
is included in Table 21-4
below.
Operating Cost Summary (US$)
| | |
Mining | $63.50 | $182.87 |
Processing | $21.00 | $71.92 |
General | $14.00 | $47.95 |
Environmental/Water | $0.82 | $2.82 |
Community/Social | $0.17 | $0.59 |
| | |
21.2.1
Mining Operating Costs
mining operating costs were developed from benchmark costs for
mining in similar deposits. The costs vary in accordance with the
average and typical mining widths, the mining volumes, and the
deposit geometry. The following unit mining costs have been adopted
for this study (Table
21-5).
Unit Mining Costs (US$)
| |
HM | $82.50 |
HS | $105.00 |
SR | $75.00 |
21.2.2
Process Operating Costs
Process
operating costs have been benchmarked at C$30 per tonne milled
based on operating costs at similar operations.
21.2.3
General and Administrative Operating Costs
An
allowance of C$20 per tonne has been allocated for general and
administrative costs.
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21.2.4
Environmental Costs
environmental monitoring costs are summarized in Table 21-2. Water treatment costs are detailed
in Section 21.1.8.
21.2.5
Community and Social
Community
engagement costs have been estimated at C$65,000 per year which
includes C$50,000 for a community liaison officer, and C$15,000 for
sponsorship of community programs.
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22.
ECONOMIC ANALYSIS
22.1
Introduction
The
financial evaluation utilizes a discounted cashflow model to
determine the after-tax NPV, payback period (time in years to
recapture the initial capital investment), and the Internal Rate of
Return (IRR) for the project. Annual cashflow projections were
estimated over the life of the mine based on the estimates of
capital expenditures and production cost and sales revenue. The
sales revenue is based on the production of concentrates and
gold/silver bullion. The estimates of capital expenditures and site
production costs have been developed specifically for this project
and have been presented in earlier sections of this
report.
The
cashflow model is based on base case metal prices and exchange
rates that are flat throughout the mine life. The model does not
account for any escalation, inflation, or reductions in operating
costs, metal prices, or smelter costs over the life of the
mine.
The
model is based on standard discounted cashflow modelling techniques
using a base case discount rate of 5 percent.
22.2
Mine Production Schedule
life of mine production schedule is shown in Table 22-1 below.
Production by Year (kt)
As required by NI43-101, the author cautions the reader that the
PEA is preliminary in nature, that it includes Inferred mineral
resources that are considered too speculative geologically to have
the economic considerations applied to them that would enable them
to be categorized as mineral reserves, and there is no certainty
that the preliminary economic assessment will be
realized.
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22.3
Metal Production
life of mine metal production is shown in Table 22-2 below.
Life of Mine Metal Production
22.4
Concentrate Freight and Insurance
and insurance costs were derived from recent contracts and are
shown in Table 22-3 below.
Concentrate Freight and Insurance (US$)
Concentrate | Freight |
Copper | $169 |
Lead | $133 |
Doré | 3% |
22.5
Smelting and Refining Terms
and refining costs (TC/RC) were validated by MineFill. The
TC/RC’s are summarized in Table
22-4 below.
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Treatment and Refining Costs (US$)
Concentrate | Treatment | Refining |
Copper | $90 per
| $0.09 $5.53 $0.40 |
Lead | $140 | $0.09 $15.00 $0.40 |
Doré |
| $1.50 $0.25 |
22.6
Concentrate Marketing Terms
primary concentrates will be sold to a metals concentrate buyer who
will sell the concentrates to a suitable smelter. It is anticipated
the concentrates will be very marketable due to the high precious
metals content. The doré will be sold directly to a metals
refiner. The concentrate marketing terms are summarized in Table 22-5 below.
Concentrate Marketing Terms
Concentrate | Payable |
Copper | Au Ag Cu |
Lead | Au Ag Cu Pb |
Doré | Au Ag |
22.7
Capital Costs
The
financial model assumes a 100 percent equity financing of the
initial capital with no debt. The initial capital has been
estimated at US$88.4 million.
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22.7.1
Sustaining Capital
allowance for mine sustaining capital expenditures during
production has been included in the financial model. The majority
of sustaining capital is allocated to capitalized mine development
as shown in Table 22-5 above. A
schedule of the sustaining capital expenditures is shown on
Table 22-6 below.
Sustaining Capital Expenditures over the Life of Mine(US$
Millions)
22.7.2
Working Capital
The
financial model does not include any delays in revenue recognition
from the year of production to the year of sales.
22.7.3
Salvage Value
A
salvage value of C$5 million was incorporated into the model based
on residual value of roughly 5 percent of the capital
equipment
22.8
Net of Smelter Revenues
The net
smelter revenues were determined by applying the estimated metal
prices against the metal production in concentrates, then deducting
the freight and insurance costs, the smelting and refining terms,
and payable metal factors to determine net value of metal
sales.
base case metal prices are shown in Table
22-7 below.
Base Case Metal Prices (US$)
Metal | Metal |
Gold | $1,350/oz |
Silver | $12.00/oz |
Copper | $3.00/lb |
Lead | $1.00/lb |
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22-4
life of mine metal revenues are shown in Table 22-8 below.
Life of Mine Metal Revenues – (US$)
Metal | |
Gold | $671.79 |
Silver | $76.85 |
Copper | $21.13 |
Lead | $3.77 |
22.9
Royalties
The
project is subject to two net of smelter (NSR) royalty agreements.
The Coombes 2 percent NSR royalty includes a royalty buyout option
of C$1.0 million if exercised in advance of production. The
financial model assumes that Auryn exercises the royalty buyout and
C$1.0 million has been added to the initial startup capital
for the project.
The
Crown grants are subject to a 2 percent NSR royalty and these
payments are included in the cashflow model. Over the life of mine
these royalty payments amount to US$4.37 million.
The
cashflow model also includes credit for C$500,000 in advance
royalty payments.
22.10
Operating Costs
mine operating costs have been calculated on the basis of the
detailed annual production of mineralized material, internal mine
waste, and development waste. Process costs and
general/administrative (G&A) costs were added along with site
costs and other overheads such as environmental monitoring. The
operating cost summary was included in Table 21-4 above.
22.11
Other Cash Costs
Other
cash costs applied to the financial model include:
■
Reclamation
sustaining costs of C$5 million
■
Closure costs of
C$5 million
■
Construction of a
water treatment plant for C$2 million
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22.12
Taxes
The tax
portion of the cashflow model was prepared internally and took into
account the Canadian and BC tax rates and regimes in effect at the
date of the report. Net income for tax purposes was determined as
metal revenues net of royalties, operating costs, reclamation and
closure costs, depreciation of tax pools and imposition of BC
Minerals Tax. In computing taxable income, further deductions for
available non-capital loss carry forwards were taken.
The
following assumptions were incorporated in the tax
model:
■
Income tax rates:
Canadian federal rate of 15 percent; British Columbia provincial
rate of 12 percent
■
British Columbia
Minerals Tax rate: Net current proceeds tax rate of 2 percent; Net
Revenue Tax rate of 13 percent
■
Tax depreciation
done on a declining balance method: Capital assets at a CCA Rate of
25 percent; Cumulative Exploration Expenses at
100 percent; Cumulative Development Expenditure pools at
30 percent
The
total income taxes payable for the life of mine are calculated as
US$64.8 million in addition to BC Mineral Taxes of US$41.5
million.
22.13
Financial Indicators
The
economic analysis was carried out using standard discounted
cashflow modelling techniques. The production and capital estimates
were estimated on an annual basis for the life of
mine.
Applicable
royalties were applied along with current Federal and Provincial
taxes and incorporated into the cashflow model. The economic
analysis was carried out on a 100 percent project basis. Given the
location and relatively uncomplicated nature of the project, the
Base Case uses a 5 percent discount factor in arriving at the
project NPV. Standard payback calculation methodology was also
utilized.
project generates a Before-Tax cashflow of US$277 million (US$184
million After-Tax) over 13 years or roughly US$21 million in
free cashflow per year. The project financial indicators are shown
in Table 22-9 below.
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22-6
Financial Indicators
| | |
NPV @
| | |
NPV @
| 170.18
| 108.09
|
NPV @
| 140.04
| 86.73
|
IRR
| 30.1%
| 23.6%
|
Payback | | |
As required by NI43-101, the author cautions the reader that the
PEA is preliminary in nature, that it includes Inferred mineral
resources that are considered too speculative geologically to have
the economic considerations applied to them that would enable them
to be categorized as mineral reserves, and there is no certainty
that the preliminary economic assessment will be
realized.
22.14
Sensitivity Analysis
Table 22-10, Table 22-11 and
Table 22-12 illustrate the Base Case
project economics and the sensitivity of the project to changes in
the base case metal prices, operating costs and capital costs. As
is typical with precious metal projects, the Homestake Ridge
Project is most sensitive to metal prices, followed by initial
capital costs, and then operating costs. The NPV in these tables is
in millions.
Metal Price Sensitivity – After-Tax
| | | | | | |
40% | 1890 | 16.80 | $372.92 | $238.61 | 39.38% | 31 |
30% | 1755 | 15.60 | $325.69 | $206.00 | 35.78% | 32 |
20% | 1620 | 14.40 | $278.45 | $173.39 | 32.00% | 33 |
10% | 1485 | 13.20 | $231.22 | $140.78 | 27.99% | 34 |
Base | 1350 | 12.00 | $183.99 | $108.09 | 23.63% | 36 |
-10% | 1215 | 10.80 | $136.76 | $75.29 | 18.82% | 40 |
-20% | 1080 | 9.60 | $89.52 | $41.94 | 13.23% | 46 |
-30% | 945 | 8.40 | $38.87 | $6.38 | 6.38% | 75 |
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22-7
Operating Cost Sensitivity – After-Tax
| | | | |
20% | $145.10 | $81.72 | 20.06% | 39 |
10% | $164.55 | $94.92 | 21.90% | 38 |
Base | $183.99 | $108.09 | 23.63% | 36 |
-10% | $203.43 | $121.25 | 25.28% | 35 |
-20% | $222.88 | $134.41 | 26.88% | 35 |
Capital Cost Sensitivity – After-Tax
| | | | |
20% | $149.01 | $78.75 | 17.08% | 43 |
10% | $166.50 | $93.42 | 20.11% | 40 |
Base | $183.99 | $108.09 | 23.63% | 36 |
-10% | $201.48 | $122.76 | 27.70% | 34 |
-20% | $218.97 | $137.42 | 32.48% | 33 |
22.15
Financial Model
summary of the base case financial model is attached in Table 22-13.
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Homestake Ridge Project
NI43-101F1
Technical Report
Base Case Financial Model (US$ Millions)
| | | | | | | | | | | | | | |
Metal | – | 8.67 | 45.80 | 115.62 | 93.00 | 65.33 | 52.76 | 53.28 | 50.41 | 42.41 | 60.20 | 65.92 | 76.35 | 33.14 |
Less: | – | (0.02) | (0.08) | (0.16) | (0.18) | (0.30) | (0.19) | (0.31) | (0.71) | (0.59) | (0.85) | (0.71) | (0.25) | (0.03) |
Add | – | 0.02 | 0.08 | 0.10 | 0.16 | – | – | – | – | – | – | – | – | – |
Less: | – | (4.17) | (19.59) | (25.10) | (25.98) | (25.27) | (25.88) | (26.77) | (26.90) | (28.75) | (29.86) | (30.19) | (26.31) | (11.40) |
Less: | (89.09) | (9.65) | (8.57) | (6.41) | (8.32) | (7.03) | (8.86) | (6.91) | (4.64) | (6.58) | (7.91) | (8.95) | (1.17) | (0.80) |
Net | (89.09) | (5.15) | 17.65 | 84.05 | 58.68 | 32.73 | 17.83 | 19.29 | 18.17 | 6.49 | 21.58 | 26.07 | 48.63 | 20.90 |
Income | – | – | – | (7.05) | (14.57) | (7.50) | (3.78) | (3.87) | (3.48) | (1.32) | (5.16) | (6.38) | (10.09) | (2.85) |
BC | – | (0.09) | (0.52) | (1.81) | (1.34) | (1.52) | (2.34) | (2.55) | (2.45) | (0.92) | (2.92) | (3.48) | (6.35) | (2.72) |
Net | (89.09) | (5.24) | 17.12 | 75.19 | 42.78 | 23.71 | 11.70 | 12.87 | 12.23 | 4.25 | 13.51 | 16.21 | 32.19 | 15.33 |
Cumulative | (89.09) | (94.33) | (77.20) | (2.02) | 40.76 | 64.47 | 76.18 | 89.05 | 101.28 | 105.53 | 119.03 | 135.24 | 167.43 | 182.76 |
Note: The cashflow model takes into account additional tax
depreciation that could be claimed in years 14-16, after the mine
closes, to generate losses in those years as tax losses can be
carried back three years. Carrying back such losses, which total
C$6.5 million, would result in a refund of C$1.8 million of
taxes previously paid.
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Homestake
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NI43-101F1
Technical Report
23.
ADJACENT PROPERTIES
There a
number of past producing mines in the vicinity of the Homestake
Ridge Project but none are currently in operation. The
following sections provide a description of the adjacent mineral
claims and past producing mines. The locations are shown on
Figure 23-1 below.
Source:
Auryn
Figure 23.1: Mineral Properties in the Vicinity of
Homestake Ridge
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Homestake
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NI43-101F1
Technical Report
23.1
Kinskuch (Extracted from the Hecla website)
On May
24, 2016, Hecla purchased 100 percent of the Kinskuch property
which consists of 156 mining claims totaling 59,400 ha. The
Kinskuch property is favorably located within the
Iskut-Stewart-Kitsault Belt north of the tidewater communities of
Alice Arm and Kitsault, British Columbia with access to the western
part of the property on a historic roadbed.
The
property hosts potential for the discovery of epithermal
silver-gold, gold-rich porphyry, and volcanogenic massive sulfide
(VMS) deposits that ultimately could lead to an economic
mine.
Prospecting
in the vicinity of the Kinskuch claim group began as early as 1889.
Exploration interest in this area in the early 1900s was fueled by
copper-lead-zinc-silver producers situated around the town of Alice
Arm such the Hidden Creek and Bonanza Mines (Granby Consolidated
Mining, Smelting and Power), which began production in 1914. The
Dolly Varden Mine located west of the northwestern flank of the
Kinskuch claim block produced silver into the late 1920’s and
the 1950’s. Production from the Kinskuch claim block is
limited to three small mines including the Esperanza Mine (4,661
tonnes), located 1.2 km north of Alice Arm, the La Rose Mine (72
tonnes) located 10 kilometres north-northwest of Alice Arm and the
Illy Mine, where 33 tonnes of ore were packed 15 km southwest to
Alice Arm by horse.
Between
1918 and 2016, a total of 37 exploration/mining companies have
conducted line cutting, prospecting, geological mapping, soil,
rock, stream sediment sampling surveys, geophysical surveys,
trenching and diamond drilling within the extents of the Kinskuch
Claims looking for precious metal enriched volcanogenic massive
sulfides (VMS) and porphyry copper
± molybdenum-gold-silver ore deposits. The most recent
work on the Kinskuch property was completed by Bravo Gold which
controlled the property between 2011 and 2015.
Bravo
Gold conducted a four diamond drill hole program totaling 855.8
metres in 2011 on the Illiance Target. In addition, they collected
245 rock samples and 388 soil samples on various target areas at
Kinskuch. In 2013, they also conducted sampling, mapping and
prospecting at the Illiance Target, with reconnaissance mapping and
rock sampling programs on the Illiance and Gold Stream target
areas.
The
Kinskuch property is located at the southern end of the area
defined as the Stewart Complex within the same stratigraphy which
hosts the Eskay Creek, Silbac-Premier, and SNIP deposits. The
Hazelton Group overlies the Stuhini Group and include hornblende
plus plagioclase phyric dacitic ignimbrites and associated volcanic
sedimentary rocks. The Lower-Middle Jurassic Eskay Creek
stratigraphy overlies these rocks and is composed of marine felsic
volcanic rocks and associated epiclastic sedimentary rocks.
Intrusive rocks are of Cretaceous to Eocene in age and are
associated with the Coast Plutonic Complex.
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Homestake
Ridge Project
NI43-101F1
Technical Report
The
Homestake and Illiance River mineralized trends located on the
Kinskuch property are Volcanogenic Massive Sulfide (VMS)
prospective trends hosted in the same stratigraphy as that which
hosts the Eskay Creek deposit to the north.
There
are no NI43-101 compliant resources reported on the Kinskuch
property.
23.2
Dolly Varden
Dolly
Varden Silver Corporation owns 100 percent of the Dolly Varden
Mines historic silver property. The Dolly Varden Mines
properties comprise 8,800 ha (88 km2) located in the
Stewart Complex, which is host to both base and precious metal
deposits, including the prolific Eskay Creek Mine. Over 220 M oz Ag
and over 7 M oz Au has been produced by the Hazelton Group Arc
Assemblage. High sulphidation VMS occurs in the youngest Hazelton
group rocks. The property hosts four historically active mines,
with unexplored sectors.
The
property hosts two past producing deposits with production of 20
million ounces of Silver. The Dolly Varden Mine produced 1.5
million ounces at an average grade of 35.7 ounces per ton in the
early 1920’s, and the Torbrit mine which produced 18.5
million ounces of silver at an average recovered grade of 13.58
ounces per ton from 1949 to 1959.
The
geology underlying the Dolly Varden property consists of
volcano-sedimentary rocks belonging mostly to the lower and middle
Jurassic Hazelton Group. These include intermediate volcanic and
volcaniclastic rocks of the Betty Creek Formation and bimodal
volcanic and sedimentary rocks of the Salmon River
Formation.
The
principal silver-base metal deposits of the Kitsault River valley
have been interpreted as vein mineralization by early workers. The
main deposits are thought to be volcanic exhalative in origin.
Deposits of this type are formed as sub-aqueous hot-spring type
deposits on the seafloor, as products of hydrothermal solutions
that have vented from sub-seafloor fracture and fault systems.
Furthermore, the silver deposits of the upper Kitsault valley are
mapped with important geological similarities to the Eskay Creek
deposit, providing an analog for exploration on the
Property.
The
most prominent mineralized zone on the Property is an aerially
extensive horizon of chemical sediment (“exhalative”)
mineralization, known as the Dolly Varden-Torbrit Horizon (the
“DVTH”) that extends from the Dolly Varden mine, on the
west, passing though the North Star underground workings and
continuing into the Torbrit mine, on the east. The DVTH exhalative
body forms an almost continuous sheet, ranging in true thickness
from 3 to 38 m, which extends from the Dolly Varden West zone to
Moose-Lamb. Syn-depositional as well as post-dispositional faults
have created a number of basins that divide the DVTH into offset
blocks.
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Homestake
Ridge Project
NI43-101F1
Technical Report
Separate
from the DVTH body, the Red Point zone (on the western fringe of
the upper Kitsault Valley) and the Wolf (on the eastern side of the
valley) each have geological similarities to the targeted
hydrothermal vein and sub-aqueous hot spring geology but are
interpreted to share a position higher in the volcanic stratigraphy
than the DVT horizon.
A
recent NI43-101 Technical Report lists 3.42 million tonnes of
Indicated Resources at 299.8 gpt Ag, (32.9 million oz) and an
additional 1.285 million tonnes of Inferred Resources at 277 gpt Ag
(11.45 million oz).
23.3
Kitsault
The
Kitsault Project is located 140 km north of Prince Rupert, British
Columbia and south of the head of Alice Arm, an inlet of the
Pacific Ocean, in the Skeena Mining Division. The Kitsault Project
was a producer of molybdenum between 1967 and 1972 and again
between 1981 and 1982. The Kitsault Project is fully permitted for
construction.
The
Kitsault property is the host of the rehabilitated Kitsault open
pit mine. The property is 100 percent owned by Avanti Kitsault
Mine Ltd., a wholly owned subsidiary of Alloycorp. A
1 percent NSR is held by Aluminerie Lauralco Inc. which may be
purchased for US$10 million within 90 days of the presentation of a
Bankable Feasibility Study.
The
property contains three known molybdenum deposits, Kitsault, Belly
Moly and Roundy Creek, and consists of 8,286 ha of mineral leases
and mining claims. Mineral Resources were estimated at Kitsault in
2009 by Avanti, and audited by SRK, using historic assay data
derived from drilling conducted from 1967 to 1982 and drilling from
2008. Earlier in 2008, SRK conducted a Preliminary Economic
Assessment which was revised in 2009 and was publicly disclosed. In
2010 Avanti released the results of a Feasibility Study on the
project prepared by AMEC. This was revised in February 2013. As
part of the Feasibility update undertaken in late 2012, a new mine
plan was used to re-estimate mine capital and operating costs. The
result of this work yielded a new NI43-101 compliant resource
statement as follows: 129.0 Mt grading 0.092 percent Mo classified
as Proven and 99.2 Mt grading 0.070 percent Mo classified as
Probable Mineral Reserves. The Reserves are stated at a 0.026
percent Mo cut-off grade.
Alloycorp
initiated the environmental assessment process for Kitsault in
April 2010. In March 2013, the EAO referred the project
to provincial Ministers for a decision on whether to issue an
Environmental Assessment (« EA ») certificate. An EA Certificate was
issued by the provincial government in March 2013, following the
conclusion that the Avanti Kitsault Project is not expected to
result in any significant adverse effects based on the mitigation
measures and conditions of the EA Certificate. Final EA approval
was received by the Government of Canada in June 2014.
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23-4
24.
OTHER RELEVANT DATA AND INFORMATION
The
authors are not aware of any additional data or information
available for disclosure.
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24-1
25.
INTERPRETATION AND CONCLUSIONS
This
Technical Report includes an updated Mineral Resource estimate
(MRE) that is based on additional drilling conducted by Auryn,
re-logging of historic cores, and a re-interpretation of the
geological model and resource wireframes. This resulted in an
18 percent increase in Indicated Resources and a 23.5 percent
reduction in Inferred Resources when compared to the 2017
MRE. The combined impact of the re-interpreted resource
wireframes is an overall reduction in tonnes, an increase in metal
grades for gold, silver and copper, and an overall reduction in
contained metal.
A
Preliminary Economic Assessment of the most recent MRE was carried
out by applying an economic cut-off grade and operating costs to
blocks inside the resource wireframes and allowing stope
optimization software to determine which blocks would produce a
positive Net Smelter Return. The resulting PEA mine plan
converted 55 percent of the overall tonnes in the 2019 MRE into
potentially economically mineable blocks. The conversion
included 66 percent of the tonnes in Homestake Main, 42 percent of
the tonnes in Homestake Silver, and 84 percent of the tonnes in
South Reef. In terms of recovered gold, the PEA mine plan
captures 56 percent of the gold at Homestake Main, 41 percent at
Homestake Silver, and 65 percent at South Reef, for an overall gold
recovery of 52 percent of the resource.
The
results of the PEA suggest that a 900 tonne per day underground
mining and milling operation could yield positive financial returns
over a 13 year mine life. Metallurgical testing to date
shows high recoveries for gold and silver in a conventional
flowsheet consisting of crushing, grinding, selective flotation to
produce base metal concentrates, and a final regrind and flotation
of pyrite tailings to produce a pyrite concentrate. Intense
leaching of the pyrite concentrate results in additional recovery
of precious metals to doré. The resulting base metal
concentrates are expected to be highly saleable, despite penalty
values of deleterious elements, due to the high precious metal
grades.
The
initial project capital of US$88.4 million is comparable to several
development stage projects of a similar size with a similar
flowsheet. Further, operating costs of $89.40 per tonne
milled benchmark favorably with similar projects such as the
Eastmain Eau Claire project, and the Pure Gold Madsen mine now
under construction.
The
authors suggest next stage for the Homestake Ridge Project should
be a combination of de-risking, and maximizing opportunities,
through the completion of Feasibility level studies as outlined in
the following sections.
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25-1
25.1
Mineral Resource Conclusions
Based
on a review of the Mineral Resource model and documentation
provided, RPA offers the following conclusions:
■
The grade estimate
is reasonable, and the model is suitable to report Mineral
Resources. The block model is of sufficient quality to be
used as an engineering basis for a PEA.
■
The Mineral
Resource model has been improved as compared to the previous
estimates. Vein solids appear to be better correlated, the
grade estimation methodology in Leapfrog is generally suitable, and
variography is reasonable.
■
Capping levels are
generally reasonable. RPA notes that Auryn applies capping
after compositing. RPA prefers to cap assays before
compositing, however, in the case of the Project, compositing and
capping during grade estimation runs produced similar results to
capping assays.
■
The sub-block size
is small at 0.5 m. RPA understands that this block size is
used to honour volumes in narrow domains, however, engineering may
have challenges when running the model through the stope
optimizer.
■
The drill and
sample database appears to be well organized and
administrated.
■
Much of the volume
of the vein sets does not meet the two metre nominal horizontal
width cut-off. Auryn states that the mineralized volume still
generally meets a grade by true width (GT) value of 4.0 (2.00 g/t
AuEq * 2.0 m horizontal thickness).
■
Assay certificate
verification results were excellent, with no errors
identified.
■
Drill collars are
placed on (LiDAR-based) topography, except for several holes
located away from the modelled zones.
■
Quality
assurance/quality control (QA/QC) procedures and results for the
Project are sufficient to support Mineral Resource
estimation.
■
Density measurement
methodology and coverage are appropriate for the
deposit.
■
The deposit is
adequately drilled to support interpretation of the vein solids in
each zone.
■
Correlation in some
parts of the deposit appears ambiguous. Choosing the
alternate interpretation in these areas, however, would not likely
result in marked differences in volume.
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25-2
25.2
Risk
At this
early stage of development, the project does carry risks in terms
of the resource classification, capital and operating costs, mining
conditions, permitting and stakeholder
approvals.
The
following risks should be addressed with further
studies:
■
Almost 88 percent
of the current Mineral Resources are classed as Inferred.
Advancing the project to a Feasibility level of evaluation will
require upgrading a large portion of the Inferred resources to
Indicated or Measured.
■
There are no
geotechnical studies or geotechnical data to support the proposed
mining method, stope spans and volumes, the mine production rate,
the stability of mine openings or mining costs allocated to ground
support. Several notable mine failures have been attributed
to over optimistic projections of ground conditions in support of
mining.
■
There have been no
groundwater or surface hydrological studies to determine
groundwater inflows during mining, and the mine dewatering
requirements.
■
A significant
portion of the capital and operating costs are based on
benchmarking costs at similar operations. These costs need to
be re-evaluated from first principles based on an actual plan of
operations and for the specific conditions at the project
site.
■
The economic
viability of the project will be sensitive to fluctuating foreign
exchange rates (US$ converted to C$) since all of the onsite cash
costs will be denominated in Canadian dollars yet all of the
revenues will be denominated in US dollars.
■
The economic
viability of the project will likewise be sensitive to changes to
the local and Federal tax regime including the prevailing tax
rates, future royalties on production, credits for tax losses, and
changes in depreciation and capital gains.
■
The PEA assumes a
year-round operation however operating in winter conditions may
prove to be challenging and may negatively impact the operating
costs.
■
The PEA financials
assume the concentrates can be sold without incurring any penalties
for mercury, arsenic or antimony.
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25-3
25.3
Opportunities
The PEA
mine plan does afford some opportunities for optimization
including:
■
The mining cut-off
grades and mining costs should be evaluated in more detail in order
to optimize the recovery of economic mineralization. This is
especially true for Homestake Silver zone which has the lowest
conversion of resources into the PEA mine plan.
■
The PEA does not
attempt to optimize the mill feed according the feed grade or
mineralization. In this preliminary evaluation the deposits
are mined in sequence whereas it may be more profitable to mine the
deposits concurrently to maximize the feed grade.
■
The Golden Triangle
region where Homestake Ridge is located is an area of intense
mineral exploration and development, and there may be synergies
with other local development stage projects in order to share some
of the infrastructure capital costs. In particular, the
construction of a transmission line to the local BC Hydro grid is
worth exploring, as are several run-of-river power schemes that
could lower the operating costs. The nearby Kitsault Lake
hydro-power scheme is another opportunity if investors are willing
to resume operations and sell the power to Homestake
Ridge.
■
The operating costs
in the PEA are based on a Contractor owned and operated equipment
fleet. An alternative option would be to lease the
underground mobile equipment (to keep the startup capital low) and
operate the mine with owner operated fleet.
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26.
RECOMMENDATIONS
In the
opinion of MineFill this Technical Report recommends that the
Homestake Ridge Project be advanced to a Feasibility level of
evaluation. The following sections include recommendations
for work that needs to be completed, and a budget.
26.1
Future Studies
26.1.1
Geology and Mineral Resources
RPA’s
recommendations are as follows:
■
RPA recommends
investigating HYR as a precaution for smearing high grade
assays. To date, drill coverage is insufficient to indicate
that the highest grades in the deposit are being smeared
unfairly. RPA recommends that Auryn consider using HYR as
more drilling is completed.
■
Grade trends show
as “stripes”, or narrow bands, sub-parallel to hanging
wall and footwall. This behaviour is in line with
Auryn’s use of variable orientation grade estimation methods
in the interpretation of the mineralization. Using full-width
composites would eliminate the phenomenon, however, contained
grades and metal would not likely change appreciably,
overall.
■
In Leapfrog, a
minimum thickness of 0.2 m was applied to HM, and pinchouts were
included in the estimation process for HS. RPA’s
high-level check estimates that approximately 25 percent of
the drill hole intercepts ≥ 2.0 g/t AuEq are less than two
metres thick, and 10 percent are less than 1.5 m thick.
RPA recommends that Leapfrog’s pinchout feature not be used
in future updates.
■
RPA recommends
building a set of minimum width vein solids in future models to
facilitate classification and mine planning. Swath plots and
comparative statistics show that block grade distribution is
reasonably controlled relative to sample grades.
■
The *_lg low grade
series of solids were constructed to allow for some grade in
dilution where appropriate, and so their morphology is different
but less important to the model. There are minor
inconsequential “blobs” of dilution away from the zones
that could be removed.
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26-1
26.1.2
Resource Drilling
A
significant program of resource drilling is needed to upgrade the
current Inferred Resources to a Measured or Indicated
Classification. Under the CSA rules, Feasibility level
studies cannot include Inferred Resources. The focus of the
additional drilling would likely include infill drilling and
definition drilling at all three of the Homestake Ridge
deposits.
26.1.3
Geotechnical Studies
A
number of geotechnical studies are required to advance the
project.
The
most critical study, at this stage, is a comprehensive geotechnical
assessment of ground conditions at the each of the 3
deposits. This study is critical because it will be needed to
validate the mining methods assumed herein, and the geometry and
size of open spans for mine development and stoping, and the
requirements (and costs) for ground control. The scope of
this evaluation must include geotechnical drilling, fracture
mapping, rock strength and rock quality assessments, and a
preliminary assessment of groundwater pressures and
flows.
Additional
geotechnical studies will also be needed to support the surface
development which includes the roads, the fresh water diversion
dam, the tailings dam and tailings impoundment, the waste rock
dumps, and the plant site. A preliminary assessment suggests
that ground conditions will be favorable but additional mapping,
test pits and drilling will be required.
The
geotechnical studies will also need to evaluate the sources and
quantities of borrow materials available for
construction.
26.1.4
Environmental Testing
Preliminary
environmental testwork has been carried out to determine the acid
generating potential of the waste rock and tailings, but additional
work is required to expand the scope to include all of the major
rock types from each of the three deposits. Once the acid
potential can be mapped to each of the major rock types it will be
possible to generate volumetric estimates of PAG versus NAG rock
produced at each deposit.
26.1.5
Environmental Monitoring
Baseline
environmental monitoring will be needed for any permit submittals
to advance the project. The key variables include: surface
water quality and geochemistry, groundwater quality and
geochemistry, air quality, and climate monitoring (wind speed and
direction, temperatures and humidity).
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26.1.6
Surface Hydrology and Water Balance
Surface
runoff from melting glaciers and rainfall will need to be assessed
in a site wide water balance as the project likely sits in a net
positive water environment (in other words the project will produce
more water than it can consume). Hydrological studies will be
needed to quantify the volumes of surface runoff, and volumes of
mine water produced as this will impact the scope and size of a
water treatment plant needed to treat water
discharges.
26.1.7
Metallurgical Testing
The
second most critical area for future studies is advancement of the
metallurgical testwork, and further optimization of the
flowsheet. This testing will be needed to optimize the metals
recovery to concentrates, and to maximize the concentrate
grades. An overview of the ongoing metallurgical testing is
as follows:
■
Continue parameter
testing to optimize the lead and copper flotation process. Tests
should investigate different regrind sizes, coarser primary grinds,
removal of cyanide, different collectors to name a
few.
■
Locked cycle tests
should be conducted to obtain dynamic metallurgical performance
estimates.
■
Generate more
concentrate for cyanide leach studies and fully optimize the leach
process. Parameters to consider are, concentrate regrind size,
cyanide dosage, addition of lead nitrate to name a
few.
■
Sub samples of
varying feed grades and geological domains should be tested using
the optimized flowsheet to understand variability in the
deposit.
■
The same subsamples
should be subjected to comminution studies to determine energy
requirements for grinding the rock. There was a significant grind
time difference between the Main and Silver zone.
■
The settling
properties of the flotation and leach tailings should be
measured.
■
Whole ore leaching
should be revisited as an alternative to the hybrid flowsheet for
comparison purposes.
26.1.8
Power Source
One of
the largest components of the operating costs will be electric
power. Even at the BC Hydro industrial power rate, power
costs will comprise about 10 percent of the operating cost.
It would seem prudent to update the 2012 Knight Piesold studies on
electric power and, in particular, the potential for installation
of a small run-of-river mini hydro.
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|
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26-3
26.2
Proposed Budget
proposed budget for the work programs listed about is US$35 million
as broken down in Table 26-1
below.
Future Work Tasks and Budget (US$)
Task | Scope | |
Resource | 120 | $30,000,000 |
| ■ Sampling |
|
| ■ Assays |
|
Metallurgical | Large | $500,000 |
Geotechnical | Geotechnical | $250,000 |
| Geotechnical | $150,000 |
Environmental | Tailings | $150,000 |
| Waste |
|
Groundwater | Monitoring | $150,000 |
| Aquifer/Packer |
|
Surface | Stream | $250,000 |
| Site |
|
Metallurgical | Additional | $500,000 |
Power | Update | $50,000 |
Pre-Feasibility | Consultants | $3,000,000 |
Total |
| $35.0 |
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|
Page
26-4
27.
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Limited, 7p.
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27-7
28.
QUALIFIED PERSONS CERTIFICATES
Qualified
Persons certificates for the following individuals are
included:
■
Dr. David Stone,
P.Eng., MineFill Services, Inc.
■
Mr. Philip
Geusebroek, P.Geo., Roscoe Postle Associates Inc.
■
Mr. Paul Chamois,
P.Geo., Roscoe Postle Associates Inc.
■
Mrs. Mary Mioska,
P.Eng., OneEighty Consulting
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28-1
