March 27, 2023

Gold activity increases at Dubreuilville, Wawa

The following article appeared in Northern Ontario Business magazine as part of the Communities on the Move series:

The rise in the price of gold in recent years has changed the fortunes of communities near the northeast shore of Lake Superior.

With several mineralized greenstone zones in the area, prospectors are pouring millions into the ground to delineate new deposits while incumbents expand and revive old mining areas.

In an area that was once home to numerous historic gold mines, this resurgence has been an economic boon to the communities of Dubreuilville and Wawa.

Here is a summary of some of the activities.

Argonaut Gold has secured much-needed funding this week to complete construction of its Magino Mine open pit project.

The Toronto mine developer closed a financing package that includes a US$200 million term loan and a US$50 million credit facility agreement to bring the historic mine back into production.

The company announced last December that the mine’s completion costs had risen from $510 million to $800 million, due to increases from inflation and the pandemic.

In addition, Argonaut closed a two percent net smelter royalty to Franco-Nevada in exchange for US$52.5 million and a $10 million directed equity investment as part of the joint stock transaction.

In a statement, Argonaut Gold CEO Larry Radford attributes the completion of this financing agreement to Magino’s “strong project fundamentals. He expressed confidence that they have the money available to complete the project to be ready for their first gold strike sometime in the second quarter of 2023.”

The company’s October newsletter shows the pace of work at the site, located a few kilometers southeast of Dubreuilville.

Inside the processing plant, equipment is being installed, an elevated belt conveyor system is being erected, and work is being done on the construction of the liquefied natural gas power plant and tailings processing area.

Pre-production excavation is underway as contractors dig into the well. See pictures and a video of the construction here.

Below the planned pit, the company has not stopped its exploration efforts as they continue to report high-grade gold strikes from the deep drilling program.

An early September press release showed assay results from the latest batch showing “several zones” of gold mineralization along a 1,500m strike. Argonaut said it reinforces their belief that Magino has a future as an underground operation.

On the east side of Magino, activities at Alamos golds Island Gold Mine is preparing to sink a new shaft for the third wave of mine expansion.

Over the next four years, Alamos will pour $756 million into the development, which aims to double gold production by the time the job is complete in 2026.

Last June, Alamos announced it was expanding its Island Gold expansion plans. With lots of high-grade gold still being found, Alamos is making the mine bigger and more efficient to become one of the lowest-cost producers in the industry.

Alamos calls this expansion a “step change” in production. Mining volumes will double from the current 1,200 tons per day to 2,400 tons when the shaft project is completed.

Annual gold production will double to an average of 287,000 ounces.

The plans call for a transition from transporting ore and mining waste along a ramp to the surface to moving ore and waste to the surface through a new shaft. This helps increase production volumes and ultimately lower operating costs. The capacity of the processing plant will also be increased and a new paste factory will be built.

In August, work began to clear the shaft and start the preliminary excavation, which includes excavation work to support the shaft of the shaft. Alamos said it will dig to a depth of 42 meters this fall. For the foundations of buildings, concrete is poured on the surface where the lift is located. This fall, the lift road towards the shaft and all the electrical work on the site were also done.

Given the strong cash flow from gold production at Island Gold and its other gold mines, Alamos said this expansion will be largely self-funded.

Alamos remains satisfied with Island Gold’s production.

The mine produced 31,400 ounces in the third quarter and has delivered 93,200 ounces in the first nine months of this year to meet its full-year production target.

And there is no stopping on the exploration side. Alamos has spent $17.9 million of its $22 million exploration budget.

Part of it is underground, where one drill machine defines new blocks to be mined. At surface, six rigs are turning to complete some gold targets, prompting new phases in the mine’s expansion across its 15,524-hectare site.

Farther east, a younger explorer Manitou gold added another wrinkle to the Dubreuilville-Wawa gold camp with a “significant” discovery this year of nickel and cobalt at its Goudreau gold property.

Goudreau is a 22,500-hectare property that Manitou believes contains nickel, cobalt and platinum group.

That spurred the Toronto company to create a spinoff, Western Nickel Corp., but Manitou insists it will continue to be a gold-focused junior explorer.

The company started a nickel drilling program in August, ended it in mid-September, and drilling results steadily trickled into its news feed.

Just outside the town of Wawa, Red pine research is a site where there have been several gold mines in the last century.

The Toronto junior miner cashed in $5.5 million in flow-through equity financing in September to chase gold expansions at its Wawa Gold Project, located about 500 meters from the local airport’s runway.

The company has already defined two occurrences on the property, Surlaga and Minto Mine South, with a combined resource of more than 700,000 ounces of gold.

Red Pine holds more ounces there as it explores deeper, and anticipates their resources will grow much larger. The company has released a steady stream of news on high-grade gold extensions and expansion of the mineral footprint around both deposits.

Adjacent to Red Pine is another Toronto junior, Kingsview Minerals, which has added the Dubreuilville and Wawa areas to its property portfolio.

Kingsview Minerals announced Oct. 19 that it has entered into an agreement with RT Minerals to pick up the 460-acre Norwalk Project between its Hubcap Project and Red Pine’s Surlaga deposit.

Norwalk has shown strong gold potential during previous ownership groups based on recent drilling and surface sampling. The historic Norwalk mine once produced 60 ounces of gold from 820 tons milled. The property also has numerous other potholes, potholes and sinkholes.
Travel west of Wawa, about 55 kilometers, in Toronto Brave companies is planning a future exploration campaign on the Farwell copper and gold property east of the Pukaskwa National Park boundary.

The company flew airborne electromagnetic and magnetic surveys over the Farwell last January to compile a list of targets for the drilling program.

Management of the company, which recently raised $95,960 in a private run, believes the 7,770-acre property is rich in precious, critical and battery metals, including nickel, lead, zinc, silver, platinum group metals and chromium.

Farwell is about three miles away Wesdome Eagle River Complex.

The Eagle River Mine came on stream in 1995 and has been a consistent producer over the years.

The midstream miner released third-quarter production numbers in mid-October, showing more than 17,600 ounces from the Mish mine and Eagle underground mine. To date, both operations have produced over 56,000 oz.

The company remains aggressive on the exploration front following the discovery of Falcon Zones on its 11,000-hectare property in 2018, which offers an opportunity to extend the life of the operation.

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