Mining Explorers 2017: Agnico Eagle Mines Ltd.
Agnico Eagle Mines Ltd. is on track to have two new gold mines in Nunavut by 2019 and has grabbed a foothold on gold exploration in Yukon Territory. In recent years, the company expanded its presence in Nunavut, a jurisdiction its sees as both politically stable and geologically rich. Agnico’s largest producing mine, Meadowbank, and two development assets, Amaruq and Meliadine, are found in this northern Canada territory. Meadowbank, which began operation in 2010, has enough ore to continue operations through the end of 2018. Agnico is investigating opportunities to extend the operation into 2019, which would bridge the gap between the end of Meadowbank mining and the expected start of production at Amaruq, a satellite deposit about 50 kilometers (31 miles) to the north. Amaruq ore will be trucked to Meadowbank, where it will be processed through the 11,000-metric-ton-per-day mill. The company currently expects Amaruq to produce 2 million ounces of gold between 2019 and 2024. At the end of 2016, Amaruq hosted 16.9 million metric tons of open pit indicated mineral resource averaging 3.88 grams per metric ton (2.1 million oz) gold; 4.9 million metric tons of open pit inferred mineral resource averaging 4.81 g/t (763,000 oz) gold; and 6.8 million metric tons of underground inferred mineral resource averaging 6.22 g/t (1.4 million oz) gold. For 2017, the company budgeted US$22 million for a 75,000-meter drill program at Amaruq. This included infill and expansion drilling at Whale Tail, the first of two open pit deposits to be developed, and similar work at V Zone, the second deposit.
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Agnico said conversion drilling completed this year at Whale Tail has confirmed the robustness of the mineralization within the main ore-shoot. For example, hole AMQ17-1366 cut 24.2 meters of 7.6 g/t gold from a depth of 340 meters depth. The second phase 2017 drilling includes directional drilling, targeting a deep extension of the higher grade ore shoot. Preliminary results from hole AMQ17-1433D, drilled to a depth of roughly 680 meters, cut 6.4 g/t gold over 4.8 meters at 596 meters and 7.2 g/t gold over 3.4 meters at 617 meters. So far, drilling has traced the Whale Tail deposit for 2,300 meters along strike and to a depth of 732 meters.
Highlights from drilling at V Zone include 38.7 meters averaging 8.6 g/t gold immediately east of the proposed V Zone pit; and 9 meters of 8.5 g/t gold at a depth of 610 meters, the deepest drill intercept in the V Zone to date. Drilling also traced gold mineralization up to 300 meters west of the V Zone pit outline.
The 2017 drill program also discovered Tugak, a showing about 4,500 meters west of the planned Whale Tail pit outline. Early results from Tugak include 10 meters of 2.5 g/t gold near surface and 3.6 meters of 3.3 g/t gold at a depth of 100 meters. Agnico said the Tugak showing requires more investigation to determine its shape and extent, and its relationship to Whale Tail and the IVR deposits.
In addition to exploration, Agnico budgeted US$78 million for capital expenditures at Amaruq in 2017. This was primarily used to finish the 64-kilometer (40 miles) road that will be used to transport Amaruq ore to the Meadowbank mill. The August completion of this road allowed for the delivery of underground mining equipment that is being used to develop a ramp for exploration. The company also received permits to develop a ramp for underground exploration at Whale Tail and construction is expected to begin early in 2018.
Agnico is on pace to begin production at Meliadine, a gold project about 25 kilometers (15 miles) from the town of Rankin Inlet, Nunavut in 2019. The company budgeted US$360 million for capital expenditures there in 2017. This work included some 5,600 meters of underground development; about 26,500 meters of drilling; and new camp and other surface facilities. In addition to the development work, the company had one drill testing the potential of targets along an 80 kilometer- (50 miles) long greenstone belt blanketed by the Meliadine property. Roughly 5,000 meters of reconnaissance drilling was completed in 2017 in anticipation of more robust regional exploration programs expected to ramp up once Meliadine goes into production.
Agnico Eagle is also pursuing near-mine exploration upside at Aura Silver Resources Inc.’s Greyhound property located 32 kilometers (20 miles) south of Meadowbank. Agnico earned an initial 51 percent interest in a portion of Greyhound upon completing a 2017 spring drilling program, a stake that can be increased to 70 percent with additional spending.
To the west in Yukon, Agnico grabbed a 19.9 percent stake in White Gold Corp., a newly formed exploration company with roughly 1 million acres of gold prospective lands in the emerging White Gold District.
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