The Frankfield Property has been the site of the majority of Gowest’s exploration investment to date, where the Company is focusing on continuing to advance the Bradshaw Gold Deposit (formerly Frankfield East) toward production, with a targeted start-up of the first half of 2016. The Frankfield Property covers an area of 842 hectares and is comprised of eight mining leases. The Bradshaw Gold Deposit currently contains approximately 422,000 ounces of gold in the Indicated category (2.1 million t at a grade of 6.2 g/t Au) and Inferred Resources of 755,000 oz. Au in the Inferred category (3.6 million t at a grade of 6.5 g/t Au) (3 g/t Au cut-off). This deposit is open along strike and at depth.
The Frankfield Property is located in the southwest part of Tully Township, approximately 32 km north-northeast of the City of Timmins, Ontario. Surface access to Frankfield is easily gained from Timmins via Highway 655 and an all-weather gravel road that turns east off Highway 655, 33.2 km north of the intersection Highways 101 and 665 and 11.5 km north of the Kidd Creek Mine access road. This 13.5 km long all-weather road ends at the Prosser/Tully Township line. The site of Gowest’s Bradshaw Gold Deposit is approximately 1.5 km further east along a drill road.
The property is underlain by tholeiitic basalt flows and komatiitic basalt to peridotite flows of the Kidd-Munro assemblage. The tholeiitic basalt flows dominate the northern half of the property and the komatiitic peridotite flows the southern half. Thin (<10 m) units of pyritic graphitic argillite interflow sediments are commonly at or close to the contacts of the komatiitic peridotite flows in the north tholeiitic volcanic sequence. Depositional indicators demonstrate a steeply north dipping and north younging direction for the Kidd-Munro assemblage on the property. The stratigraphy has been deformed by at least two periods of deformation, as is common in the Abitibi Greenstone Belt.
Three gold mineralization areas presently exist on the Frankfield Property: the Bradshaw Gold Deposit (see description below), the Sheridan Gold Deposit (“Sheridan”) (formerly the Texmont deposit) and the Dowe gold zone.
In the northwest part of the property, the Sheridan Gold Deposit is hosted in a carbonate, hematite and sericite altered shear zone within a sequence of tholeiitic basalt flows. The shear zone strikes N086°E and dips 75° to the north. Sheridan is a sulphide mineralized zone of 3-5% disseminated pyrite and very fine microscopic arsenopyrite with quartz vein flooding. Intex reported in 1982 that the Sheridan Gold Zone (formerly Texmont zone) contained 103,400 t averaging 7.54 g/t Au across and average width of 3 m along a strike length of 152 m and to a depth of 75 m. Gowest is not treating this historic mineral resource estimate as a NI 43-101 compliant resource verified by a qualified person and the estimate should not be relied upon. Subsequent drilling by Cyprus Gold (Canada) Limited in 1991 showed that the deposit extended to at least a depth of 360 m. Gowest drilled six diamond drill holes in 2010. The two best intersections obtained were 4.1 g/t Au over a down-hole length of 13.7 m and 4.1 g/t Au over 0.6 m. The Gowest drilling has traced the Sheridan Gold Zone for 250 m and it is open along strike and at depth below 200 m. Gowest has not prepared a mineral resource estimate for this deposit.
The Dowe gold zone is located in the southeast part of the Frankfield Property. Intersections of 2.86 g/t Au over 3.38 m, 1.8 g/t Au over 12 m and 1.9 g/t Au over 3.4 m have been reported from drilling in 1997-1998. Mineralization is reported to occur in quartz veins within a wedge of mafic volcanic rocks enclosed in ultramafic rocks. The mafic rocks are reported to be ankeritized and slightly silicified. Visible gold has been reported, together with pyrite. No arsenopyrite has been reported. The showing is reported to have a strike length of at least 150 m and has not been closed off.
Bradshaw Gold Deposit
Gold mineralization in the Bradshaw Gold Deposit occurs primarily within a fractured, sulphidized and brecciated hydrothermal alteration horizon in basaltic flow rocks at or near the contact with steeply north dipping (85º) footwall ultramafic rocks to the south. This portion of the deposit is identified as the geological Main Zone. The mineralization is not confined to narrow vein-like structures (as can be seen in many other deposits in the area) but rather, in a more massive/tabular structure than is consistently present throughout the mineralized horizon. This characteristic is shared by the major past gold producers in the Porcupine camp including Hollinger, McIntyre and present producer Goldcorp at their Dome and Hoyle Pond deposits. Within the geological Main Zone, higher-grade gold mineralization is localized along the footwall of the horizon, termed the MZ1 Zone and along the hanging wall of the horizon, termed the MZ2 Zone. Pervasive silicification, minor ankerite veining, hematite staining along with the presence of tourmaline generate a recognizable mauve to pink hue for the Main Zone. Total sulphide content of the mineralized horizon varies from 3-30% with occasional 2-5 cm wide bands of massive arsenopyrite and pyrite. The largest concentrations of sulphides correspond to the highest gold concentrations.
A second type of gold mineralization is hosted within the basalt flows. This mineralization forms multiple structures parallel to the strike and dip of the Main Zone and are referred to as Hanging Wall Zones as they are located immediately north of the Main Zone. They are seen as highly silicified zones accompanied by intense bleaching, brecciation and quartz flooding, tourmaline, 5-10% pyrite and arsenopyrite. As in the Main Zone, higher concentrations of arsenopyrite give rise to higher gold values. A total of five such parallel structures (HWZ1 to HWZ5) have been identified in locations and are significant contributors to the total number of ounces of gold contained within the overall Bradshaw Gold Deposit.
To date, the deposit has a drilled strike length in excess of 950 m, trending N070-080°E, and has been tested to a depth in excess of 1,000 m. MZ1 Zone mineralization ranges in width from 1-12 m (true width). The MZ2 Zone mineralization ranges in width from 1 to 6.9 m wide (true width). The widths of the Hanging Wall Zones typically vary from 2 to 4 m up to a maximum of 12 m. The deposit remains open at depth.
Gowest has been exploring the Frankfield Property since 1983. A number of diamond drilling campaigns have been carried out on the property and semi-continuous diamond drilling has been carried out since 2004. Following a reorganization and change of the Company’s management team, Gowest has more than doubled the size of the original mineralized envelope at the Bradshaw Gold Deposit since 2010 when it contained an Inferred mineral resource of 510,000 ounces (oz.) of gold (Au) (2.4 million tonnes at 6.5 grams per tonne gold “g/t Au”).
In mid-2011, Gowest contracted a HELITEM electromagnetic and magnetic airborne geophysical survey (“the airborne survey”) covering what was then – before Gowest added more land to the project area – the entire NTGP to map the geology and structure of the area.
In 2012, the Company completed the environmental baseline work for mine permitting, a First Nations Memorandum of Understanding agreement, a positive full-scale ore sorting optimization test and a drilling program focused on further resource expansion at the Bradshaw Gold Deposit and other regional exploration targets. Site reviews were carried out for the construction of an ore processing facility. The resource expansion drilling program confirmed gold mineralization to at least 1.4 km along strike and 1.1 km vertical depth (deposit remains open).
On June 9, 2015, Gowest announced the results from the Pre-Feasibility Study (“PFS”) completed for its 100% owned Bradshaw Gold deposit (“Bradshaw”), part of the larger North Timmins Gold Project (“NTGP”). In preparing to reach this critical milestone, Gowest has raised sufficient capital over the last few years to enable the Company to significantly advance Bradshaw by expanding the historical resource (through drilling and analysis in excess of 65,000 meters of core), developing a detailed mine plan and completing the work required to obtain the various mining permits. The PFS was conducted by Stantec Mining (“Stantec”) through their Mississauga, Ontario office. The PFS was focused on mining the upper 500 vertical meters (“m”) of mineralization at Bradshaw. Previous drilling has intercepted mineralization at a vertical depth of 1,350 m, indicating the deposit remains open for additional development.
Highlights of PFS (100% Equity, All figures in USD):
|Exchange Rate||CAD $1.00 = US$0.80|
|Pre-tax Net Present Value (“NPV”) (5%)||$39.8 million|
|Pre-tax Internal Rate of Return (“IRR”)||32%|
|After-tax NPV (5%):||$29.2 million|
|Initial Capital||$21.5 million|
|Sustaining Capital||$21.4 million|
|Pre-tax Payback Period||3.5 years|
|Life of Mine (“LOM”) Operating Cost||$821/ounce (“oz”) gold (“Au”)|
|All-in Sustaining Cost1||$891/oz|
|Ore Mined||1, 787,295; tonnes (“t”)|
|Avg. Mineable Ore grade||4.82 grams per tonne (“g/t”) Au|
|Development Rock Mined (additional mineralized rock)||666,253 t|
|Avg. Development Rock grade||1.31 g/t Au|
|Initial LOM (includes bulk sample)2||8.5 years|
|Total Gold (extracted in initial phase)3||305,058 oz|
|Total Gold Recovery||93%|
|Avg. Annual Recovered Au Production||40,500 oz|
|Gross Revenue to Operation||$341 million|
- All-in Sustaining costs are inclusive of LOM Operating Costs and Mine Sustaining Capital Cost as described in the Capital and operating costs highlights section in this release.
- Initial LOM includes 1.5 years of pre-production and 7 years of full production.
- Total gold ounces is mineral reserve ounces plus development rock ounces
The Company notes:
- The PFS includes the ounces contained in the reserve derived from the updated measured and indicated resources of the gold mineralization at Bradshaw and does not include any of the inferred ounces of gold mineralization;
- Additional mineralization that does not qualify as a reserve for these calculations has been identified in the development rock which is recoverable at a profit by using rock sorting technology and is expected to generate additional gold production;
- The PFS is based on using third party mining, milling and refining;
- The Company plans to use advanced rock-sorting technology to increase gold production beyond the scope for this PFS.
Mineral Reserve Estimate
The defining of probable reserves is a significant step forward for the Bradshaw, which has previously reported only mineral resources, while useful, were estimated using less critical and non-economic technical parameters. The PFS mineral reserve is based on an economic analysis of the updated mineral resource using the costs developed during the PFS, and the metallurgical and ore sorting test work to estimate the recovery factors.
The updated resource estimate as part of the PFS for the Bradshaw is as follows: Indicated Resources 2,121,866 tonnes grading 6.19 g/t Au and Inferred Resources of 3,629,097 tonnes grading 6.47 g/t Au using a 3 g/t Au cut-off grade, effective January 12, 2015. Mineral resources were defined using all drill hole results up to December 2014, a minimum 2 m core length, a bulk density of 2.89 g/cm3 and a gold price of US$1,200. It is reported in accordance with the requirement of National Instrument 43-101 – Standards of Disclosure for Mineral Projects and CIM Standards on Mineral Resources and Reserves. This resource estimate and block model was used by Stantec for this report. While the Indicated Resource has changed from the 2012 report (Gow, November 15, 2012) due to implementation of more rigorous modelling parameters such as improved wireframes, reduced search distances and removal of non-compliant historical drill holes, it has also shown an increased average grade of 6.2 g/t and the emergence of two additional hanging wall zones, as well as an average drill hole spacing of 25 m.
Indicated Resources at the Bradshaw were identified above 500 m vertical depth for the Main Zone (“MZ”) 1 and MZ2 and above 400 m vertical depth for the Hanging Wall Zones (“HWZ”), where drill hole spacing is approximately 35 m or less. Inferred Resources occur directly below the Indicated Resources and the deposit remains open along strike and at depth.
The mineral reserves were estimated using engineering and operational design parameters described in the PFS conducted by Stantec. The deposit is planned to be mined using blast hole stoping with delayed backfill methods with 30 m sub-levels in the majority of the mining areas. Internal dilution has been included in the final mineral reserve estimate. Stantec is of the opinion that the mineral reserve estimate derived in this PFS reasonably quantifies the economical ore mineralization of the Bradshaw. The mineral reserve and PFS are effective as of June 5, 2015 and the mineral reserves derived for the Bradshaw are presented in the table below.
BRADSHAW MINERAL RESERVES (at a 3 g/t Au cut-off)
|Category||Tonnes||Average Grade||Ounces of Gold|
|Probable||1, 787,295||4.82 g/t Au||277,101|
The expected amount of gold (305,058 oz) to be mined from the Bradshaw during this phase of mining consists of the mineral reserves (277,101 oz) and mineralized development rock (27,957 oz). The mineralized development rock will be excavated as mining drifts are driven along the mineralized zones to access the mineral reserves. This development rock was estimated to be 666,253 tonnes grading 1.31 g/t Au. The utilization of advanced rock sorting technology will allow the economic recovery of the gold mineralization contained in the development rock that would normally be disposed as waste, for shipping to the mill for processing. Rock sorting technology is a highly effective process, which as demonstrated in bulk-scale testing of Bradshaw material (see Gowest release dated September 10, 2012), rejects over 50% of waste rock increasing the gold grade and reducing tonnage to be transported to the mill.