Integra Gold Announces PEA Results: Pre-Tax IRR of 51%, NPV (5%) of
CAD$146.0 M (After-Tax $88.5 M) and Peak Annual Production of
143,300 Gold Ounces
PEA Highlights:
- Base Case Pre-tax IRR of 51% and NPV (5% discount rate) of
CAD$146.0 M
- Average annual production of 112,400 Au ounces per year with
peak annual production at 143,300 Au ounces per year and total
production of 505,600 ounces
- Life of Mine ("LOM") cash cost of CAD$665
per Au ounce and cash costs plus sustaining costs of CAD$805 per Au
ounce
- In excess of 29,500 meters ("m") of drilling
completed subsequent to the database cut-off date for the resource
estimate used in the PEA highlighting strong potential for resource
expansion
- Proposed underground mine with a vertical depth of 620 m and
material processed at nearby mills
- The plan as outlined in the PEA will have minimal impact on
the community as there are no homes, businesses, or other
infrastructure where the proposed mining will take place
VANCOUVER, BRITISH COLUMBIA--(Marketwired - Mar 11, 2014) -
Integra Gold Corp (TSX-VENTURE:ICG) ("Integra" or the "Company") is
pleased to report the results of a NI 43-101 compliant Preliminary
Economic Assessment (the "PEA") carried out on the Company's
flagship Lamaque Gold Project (the "Lamaque Project") in Val-d'Or,
Québec, Canada. The PEA was prepared by InnovExplo Inc.
("InnovExplo") with technical contributions from AMEC, Golder
Associates, Geologica Groupe-Conseil Inc., Geopointcom Inc. and WSP
Engineering. The technical report with respect to the PEA will be
filed on the Company's website and SEDAR within 45 days.
For clarification, Integra's Lamaque Project is separate from
the adjacent Sigma and Lamaque mines, which have collectively
produced over nine million ounces of gold to a vertical depth of
2,000 m.
The Company has provided a base case scenario (the "Base Case")
using a USD$1,275 per ounce gold price and a 1.05 CAD to USD
exchange rate which is equivalent to CAD$1,339 per Au ounce (March
7, 2014 closing spot price was CAD$1,485 per ounce and exchange
rate was 1.11). All currency figures are in Canadian Dollars (CAD$)
unless otherwise stated. The Base Case economic evaluation has a
pre-tax internal rate of return ("IRR") of 51%, payback of capital
in 1.5 years and a net present value ("NPV") of $146.0 million at a
discount rate of 5%.
The PEA is preliminary in nature and it includes inferred
mineral resources that are considered too speculative geologically
to have the economic considerations applied to them that would
enable them to be categorized as mineral reserves. There is no
certainty that the PEA will be realized.
"This PEA represents a significant milestone for Integra and we
are very encouraged by both the outcome and our team's continued
ability to deliver within the timeframe we committed to. Our
decision to advance the project to the PEA level was guided by the
success obtained in the past by both Teck and Placer Dome, at the
neighboring Lamaque and Sigma Mines a few hundred meters from our
property boundary. These mines produced over 9 million ounces of
gold over respective 50 and 60 year mine lives, yet seldom had more
than 3 years in reserves, and often less than one. The PEA outlines
a scenario showing potentially strong financial returns and based
on the success we've had drilling since the resource estimate was
done we are confident the mine life has potential to grow,"
commented Company President and CEO, Stephen de Jong. "30,000
meters of drilling has been undertaken since the resource estimate
was completed in 2013, and we currently have 4 exploration drill
rigs active on the Triangle Zone with results from over 10,000
meters pending. The resource used for the Triangle Zone in the PEA
was limited to a depth of 620 meters, although drilling has now
intersected high-grade mineralization within the same host rock to
a depth of 1,000 meters, as well as 200 meters south of the
resource limit. I want to thank our team and our consultants for
the work they did to complete this PEA, they continue to prove they
are the Company's most valuable asset."
Base Case
Assumptions/Highlights
Gold Price (USD$) |
$1,275 |
Exchange Rate (CAD$ to USD$) |
1.05 |
Gold Price (CAD$) |
$1,339 |
Average Annual Gold Production (ounces) |
112,400 |
Peak Annual Gold Production (ounces ) |
143,300 |
Pre-Production Capital Costs (CAD$) |
$69.2 M |
LOM Sustaining Capital (CAD$) |
$66.8 M |
Pre-Production Period (years) |
2 |
Mine Life (years) |
4.25 |
Cash Cost per Au Ounce (CAD$) |
$665 |
Cash Costs and Sustaining Cost per Au Ounce (CAD$) |
$805 |
|
PRE-TAX |
|
Life of Mine NPV at 5% Discount Rate (CAD$) |
$146.0 M |
Internal Rate of Return |
51% |
Payback Period (years) |
1.5 |
|
|
AFTER-TAX |
|
Life of Mine NPV at 5% Discount Rate (CAD$) |
$88.5 M |
Internal Rate of Return |
38% |
Payback Period (years) |
1.8 |
Base Case
Comparison to Spot Gold Price & Current Exchange Rate
|
Base Case |
Gold Spot Price and Current Exchange Rate (March 07, 2014) |
Gold Price (USD$) per Au ounce |
$1,275 |
$1,339 |
Exchange Rate |
1.05 |
1.11 |
Gold Price (CAD$) per Au ounce |
$1,339 |
$1,485 |
Pre-Tax IRR |
51% |
68% |
Pre-Tax NPV (5%) (CAD$) |
$146 M |
$205 M |
Pre-Tax Payback (years) |
1.5 |
1.2 |
Production Profile
(Diluted Head Grade after Mining)
Year |
Tonnes |
Grade (g/t Au) |
Au Ounces Recovered |
pre-production |
- |
- |
- |
pre-production |
124,500 |
7.46 |
28,000 |
1 |
398,500 |
7.97 |
95,500 |
2 |
512,400 |
9.35 |
143,300 |
3 |
463,700 |
9.25 |
127,000 |
4 |
501,500 |
6.76 |
98,700 |
5 |
80,800 |
5.88 |
13,100 |
TOTAL |
2,081,400 |
8.19 |
505,600 |
PEA Overview
The PEA was prepared as an underground mining project based
solely on the mineral resources reported by the Company on
September 25, 2013. Mineralization would be accessed by way of two
separate ramps, or declines, located at the Parallel Zone in the
north (the "North Ramp") and the Triangle Zone in the south (the
"South Ramp"), approximately 2 km apart. Material would then be
transported to an off-site mill for toll processing, eliminating
the need for the construction and permitting of a new mill and
tailings facilities.
The pre-production period is estimated to be 2 years allowing
for the construction of surface installations, portal preparation,
ramp development and stope preparation. The PEA considers beginning
development of the North Ramp after an initial 3 months of surface
preparation and construction. Development of the South Ramp would
commence 3 months thereafter.
Limited production would occur during the pre-production stage,
accounting for approximately 28,000 ounces throughout the second
year of pre-production.
Average annual production after the pre-production stage is
460,500 tonnes at a diluted grade, or head grade, of 8.24 g/t Au
for 112,400 Au ounces recovered (average 92.1% recovery).
The PEA assumes a toll milling, or contract milling, scenario in
which material from the Lamaque Project is processed at a mill
within the immediate vicinity. For the purposes of the PEA, a
combined toll milling and transportation cost of $45.69 per tonne
has been applied, based off of actual custom milling and
transportation quotes, which InnovExplo confirms are consistent
with the anticipated rates for milling in the Val-d'Or area over
the proposed project timeline.
The Company is currently conducting a thorough review and
analysis of both available toll milling operations and potential
acquisitions in the immediate area with preliminary results
indicating multiple opportunities.
Mineral Resources
The PEA assumes that underground mining will be used for
resource extraction. The mineral resource estimate as initially
disclosed on September 25, 2013 (database cutoff date of April 24,
2013) was used as the basis of the PEA. Initial disclosure of the
resource assumed a 3 g/t Au cut-off grade diluted to a 2 m minimum
true thickness with resource figures also provided using a 5 g/t Au
cut-off.
For the purpose of the PEA, and accounting for both the proposed
mining methods as well as using a price of USD $1,175 per Au ounce
for guidance, the Company used variable cut-off grades of between
4.0 g/t Au and 5.0 g/t Au for stope design, dependent on each
specific resource block.
Mineral Resources
at 5 g/t Au cutoff
|
Indicated Resources |
Inferred Resources |
Zone |
Tonnage (Metric tonnes) |
Grade (g/t gold) |
Contained Gold Ounces |
Tonnage (Metric tonnes) |
Grade (g/t gold) |
Contained Gold Ounces |
Fortune |
60,700 |
8.0 |
15,610 |
111,300 |
7.7 |
27,470 |
Triangle |
412,200 |
12.6 |
167,200 |
258,000 |
15.4 |
128,000 |
No. 4 Plug |
522,900 |
8.3 |
140,280 |
- |
- |
- |
Parallel |
529,300 |
10.4 |
176,120 |
119,200 |
21.2 |
81,070 |
Total |
1,525,100 |
10.2 |
499,210 |
488,500 |
15.1 |
236,540 |
Mineral resources are not mineral reserves and do
not have demonstrated economic viability. All figures are rounded
to reflect the relative accuracy of the estimate. All assays have
been capped where appropriate. |
For the Fortune and Triangle zones, all inferred resources were
considered in the mining scenario. Due to the high gold grade of
the Parallel Zone inferred resources which are based on minimal
drilling, only 40,900 tonnes at a grade of 9.13 g/t Au of inferred
resources were considered. The PEA study did not incorporate the
resources identified in the crown pillar.
The Company updated its Lamaque Project resource estimate on
January 28, 2014, with the addition of the No. 6 Vein and the
Sixteen Zone. These zones have not been included in the PEA and are
therefore not discussed here.
Additional Resource Potential
As of February 28, 2014, the Company had drilled an additional
29,500 m at the Lamaque Project which has not yet been included in
any resource estimate calculation or the PEA. Drilling not included
in the resource calculation or in the PEA consists of:
- South Triangle: 6,966 m in 13 holes
- Parallel: 12,589 m in 40 holes
- Triangle: 9,890 m in 26 holes
The 2013 South Triangle drill program aimed at extending the
Triangle Zone to the south and at depth. Drilling intersected high
grade mineralization to a depth of over 1,000 m vertical as well as
approximately 175 m down-dip of the southern extent of the Triangle
Zone resource limit. There are currently four drills on the
Triangle Zone which, apart from completing definition drilling,
will step out and drill this untested 175 m wide target zone as
well as exploring for near surface strike extensions.
Drilling not included at the Parallel and Triangle Zones
consisted of both infill and extension drilling. The results for
the Parallel Zone drilling were disclosed in early 2014 and confirm
continuity of the mineralized zones, which the Company hopes will
assist in converting further ounces from the inferred to indicated
category. The infill and extension drilling at the Triangle Zone
started in January 2014 and no results have been disclosed to date.
An updated resource estimate expected in the second half of 2014
will focus on building resources in order to increase the mine life
beyond the current 4.25 years.
Mining
The Lamaque Project is
designed as a mechanized underground mine which utilizes both
conventional room and pillar and long-hole mining methods. An
administration and mine service hub would be located on Highway
117, the Trans-Canada Highway. The service hub would be served by a
25 KV power line, natural gas and municipal services. There will be
two production centers, each with a ramp to access resources (the
"North Ramp" and the "South Ramp") and will include basic surface
infrastructure. Common infrastructure will be used to treat and
manage water from underground operations.
The North Ramp will be located
approximately 1 km from the service hub and will reach a vertical
depth of 615 m to initially access the Parallel and Fortune zones.
Should the Company outline resources at its No. 5 Plug and No. 3
Mine targets, it is anticipated these zones would also be accessed
through the North Ramp.
The South Ramp will be located
approximately 3 km from the service hub and would reach a vertical
depth of 620 m. The South Ramp would access the Triangle Zone and
the No. 4 Plug. The South Ramp area would be connected to an
existing gravel road a few hundred meters to the south, allowing
for two entry points to the site.
The mining methods used in the
PEA were selected according to vein geometry and common practices
for comparable mining operations in the region, an area with an
extensive history of underground mining. For mineralized zones
dipping less than 45 degrees, a room and pillar mining method is
proposed. Mechanized sub-level development in mineralized zones
will be completed at 60 m intervals along the vein, rooms will be 6
m in width and a performance rate of 18 t/man shift was used in the
mine plan. Typical stopes will have a height of 2 m and external
dilution of 5% (at 0.0 g/t Au) was included with a mining recovery
of 85%.
For mineralized zones dipping
more than 45 degrees, a long-hole mining method will be used with
mechanized sub-level development completed at 18 m intervals along
the vein. As outlined in the PEA, typical stopes will have a
thickness of 3 m and a length of 20 m. An average of 20% (at 0.0
g/t Au) dilution has been applied when stope thickness is greater
than 3 m, and 35% for stopes less than 3 m. Mucking will be done
longitudinally using remote controlled scoops and the mining
recovery is evaluated to be 85%. Rock-fill will be used in
long-hole stopes for the North Ramp.
Mineralized material and waste
will be transported to surface using 45T trucks. The cost for
material handling is estimated to range from $7.91/tonne to
$11.91/tonne. During the mine life, development would generate
approximately 14% of the mineralization tonnage, room and pillar
mining 36% and long-hole mining, 50%.
The following table summarizes
development and mined tonnes for the Lamaque Project:
Mining |
North Ramp (tonnes) |
South Ramp (tonnes) |
Development |
159,900 |
126,400 |
Room and pillar |
290,000 |
468,200 |
Long hole |
539,400 |
497,500 |
Total |
989,300 |
1,092,100 |
For the economic evaluation, it was assumed that a down payment
of 25% would be paid on mining equipment with the balance paid over
5 years at a 6% interest rate. Residual value was limited to 25% to
35% depending on years of use.
Operating Costs
Operating costs are summarized below. Given that this PEA
presents a toll milling scenario and the Company has the ability to
process mineralized material recovered during the pre-production
and development stage, revenue generated from these ounces has been
included in forecasted cash flows. A total of approximately 28,000
ounces are anticipated to be produced during year 2 of the
pre-production phase.
Cash Cost Per
Ounce and Per Tonne Summary
Cash Cost Summary |
CAD$/ounce |
CAD$/tonne |
Mining |
339 |
83 |
Processing |
187 |
46 |
G&A |
122 |
30 |
Refining |
3 |
0.73 |
Cash Cost |
651 |
159 |
Royalties |
13 |
3 |
Total Cash Costs |
665 |
162 |
Sustaining Costs |
140 |
34 |
Cash Costs + Sustaining Costs |
805 |
196 |
Metallurgy & Processing
The LOM average tonnage is approximately 1,275 tonnes per day,
and varies between 1,050 and 1,650 tonnes per day depending on the
period (based on 312 operation days/year). This production rate is
consistent with potential milling options in the immediate area,
and may change during actual production depending on which
processing facility is used. This includes resource extraction from
both ramps thereby minimizing undue pressure put on any one point
of production and reducing potential bottlenecks while mining.
Recent metallurgical testing completed in 2014 tested Lamaque
mineralized material using a variety of flowsheets consistent with
those of mills in the immediate area (see Company press release
dated February 25, 2014). Although metallurgical testing indicated
an increase of recoveries when going from a 48 hour leach time to a
96 hour leach time, the Company has used recoveries in line with
the top end of the 48 hour leach time in order to stay consistent
with the flowsheets of mills in the vicinity.
Using this testwork the Company was able to identify which mills
are best suited for material from the Lamaque Project, which has
assisted in the determination of the $45.69 per tonne milling and
transportation assumption.
For the PEA the following gold recoveries were assumed:
- Parallel Zone: 97%
- Triangle Zone: 90%
- Fortune Zone: 95%
- No. 4 Plug: 86%
Infrastructure and Capital Costs
The Lamaque Project, located within 3 km of the city of
Val-d'Or, Québec, a mining community of over 35,000 people,
benefits from world-class infrastructure. As important as the
physical infrastructure in the Val-d'Or region, is the high level
of underground mining expertise readily available in the region.
The Company believes its advantageous location has the potential to
positively impact the long term viability and attractiveness of
employment at the Lamaque Project, given that employees and
contractors could work in the community they live in, a rare
opportunity in the mining industry.
The Lamaque Project is located within 200 m of the Trans-Canada
Highway, with all services readily available at site. The Company's
existing office is located between the highway and the project, on
a property owned by the Company, and there is sufficient land to
accommodate the proposed development needs of the project including
the proposed service hub.
The plan as outlined in the PEA will have minimal impact on the
community as there are no homes, businesses, or other
infrastructure where the proposed mining will take place.
The pre-production costs are estimated at $69.2 million, net of
production revenue received during the second year of the
pre-production period ($37.4 million). Pre-production capital costs
include surface infrastructure (site preparation, roads, electric
and water lines), installation of modular buildings for offices and
garages (mechanical and electrical shops, stockroom), mining
infrastructure at the North and South sites, mobile equipment,
development and capitalized operating costs, owner costs (closure
costs in line with required financial guarantees, Company staff and
indirect costs) as summarized in the following tables.
Pre-production capital costs are minimal given that there is no
need to build processing and tailings facilities, and that
mineralization is spatially close to surface. Pre-production is
anticipated to take 2 years with the majority of proceeds used for
ramp construction and for sufficient development of mineralized
zones, or working faces, to conduct mining at the proposed mining
rate and mill throughput. Ramp construction would commence in the
second quarter of pre-production at the Parallel Zone, where there
is a 15 m vertical rock face outcrop located at surface providing
an ideal location to construct the portal. Ramp construction at the
Triangle Zone would commence in the third quarter of
pre-production, where overburden is estimated to be between 1 and 5
m in depth.
Pre-Production
Capital Costs Estimate (estimated 2 years)
Pre-Production Capital Costs |
(CAD$ millions) |
Surface infrastructure (20% contingency included) |
12.9 |
Mining infrastructure (20% contingency included) |
6.9 |
Mobile equipment (10% contingency included) |
14.8 |
Development and Capitalized Operating Costs (20% contingency
included) |
55.6 |
Owner's Costs |
16.3 |
Offsetting capitalized revenue (28,000 ounces in
pre-production)* |
(37.4) |
Total |
69.2 |
*Given the Company anticipates having access to milling options
throughout the pre-production stage it has included revenue from
expected production during development |
The Company is also studying a scenario which would involve
delaying the development of the South Ramp by 12-18 months in order
to reduce up-front capital cost requirements and utilize cash flow
from the North Ramp to fund development of the South Ramp. It is
estimated this could reduce pre-production capital requirements by
as much as $20 to $25 M although further work is required prior to
the Company being able to provide a detailed number.
Sustaining Capital
Costs Estimate (Production Years 1-5)
Sustaining Capital Cost |
(CAD$ millions) |
Surface infrastructure (20% contingency included) |
$4.7 |
Mining infrastructure (20% contingency included) |
$3.1 |
Mobile equipment (10% contingency included) |
$17.3 |
Development (20% contingency included) |
$39.0 |
Owner's Costs |
$2.6 |
Total |
$66.8 |
Community Relations
The Company is committed to taking a proactive approach to its
public consultation process and has been working diligently to
identify as many stakeholders as possible in the Val-d'Or region.
Over the past six months more than 25 private and public meetings
have been held with stakeholders.
On January 28, 2013, a public information meeting was held in
Val-d'Or to present the status of the project, discuss the
potential impact and benefits for the Val-d'Or community, and
gather insight and feedback from residents. Over 250 residents and
stakeholders attended this meeting. Management was encouraged by
the feedback received and the readily apparent level of community
support for the Lamaque Project. Integra remains committed to
working with the citizens of Val-d'Or to build a plan for the
Lamaque Project that will maximize benefits for both the community
and the Company's shareholders.
Information regarding public meetings and project updates will
be published on the Company's website as it becomes available.
Environmental and Permitting
A baseline environmental study was completed by AMEC in December
2013. The North Ramp is located in an area previously impacted by
the tailings of the Lamaque Mine and the Company does not
anticipate any significant impact on wildlife. For the South Ramp,
the baseline study completed by AMEC did not identify major issues
associated with wildlife.
No geochemical characterization of mineralized or waste material
is available for the Lamaque Project at the moment. The Company
will be commencing these studies in 2014 and does not anticipate
any major issues due to the similar nature of the Lamaque Project's
mineralization to the adjacent Sigma and Lamaque Mines, which were
known for their clean ore and tailings.
The Lamaque Project is not subject to provincial impact
assessment study as planned production falls below the 2,000 tonnes
per day threshold outlined in the new mining law. At this time the
Company does not yet know if the Lamaque Project will be subject to
a federal impact assessment study.
Reclamation costs were estimated at $2.4 M. Reclamation work
covers waste and stockpiles of mineralized material, water pond,
underground openings, site installation, engineering, contingency
(20%) and post operation site monitoring.
Project Economics and Sensitivity
Key economic performance metrics are summarized in the following
table on a pre-tax basis. A range of gold prices (USD$) are shown
for sensitivity purposes only.
Gold Price
Sensitivity
Gold Price (USD$/ounce) |
1,000 |
1,100 |
1,200 |
1,275 (Base Case) |
1,400 |
1,500 |
Exchange Rate (CAD$ to USD$) |
1.05 |
1.05 |
1.05 |
1.05 |
1.05 |
1.05 |
Gold Price (CAD$/ounce) |
1,050 |
1,155 |
1,260 |
1,339 |
1,470 |
1,575 |
Pre-Tax NPV 5% (CAD$M) |
29.2 |
71.7 |
114.2 |
146.0 |
199.1 |
241.6 |
Pre-Tax IRR |
15% |
29% |
42% |
51% |
66% |
77% |
Pre-Tax Payback Period (years) |
2.91 |
2.14 |
1.71 |
1.50 |
1.25 |
1.11 |
The sensitivity analysis presented below demonstrates that even
with an increase of 30% of capital costs or operating costs, the
Lamaque Project still has the potential to present a positive
economic outcome.
Exchange Rate,
Capital Costs, Operating Costs Sensitivity Analysis (Pre-Tax)
|
Variable |
Net Cashflow (CAD$ M) |
NPV (5%) |
IRR |
Exchange rate $CAN to $US |
0.95 |
133.3 |
94.4 |
36% |
1.00 |
165.2 |
120.2 |
44% |
1.05 |
197.1 |
146.0 |
51% |
1.10 |
229.1 |
171.8 |
59% |
1.15 |
261.0 |
197.6 |
66% |
Capital Costs |
30% |
157.0 |
110.6 |
35% |
20% |
170.4 |
122.4 |
40% |
10% |
183.8 |
134.2 |
45% |
0% |
197.1 |
146.0 |
51% |
-10% |
210.5 |
157.8 |
59% |
-20% |
223.9 |
169.6 |
67% |
-30% |
237.2 |
181.5 |
77% |
Operating Costs |
30% |
104.3 |
71.7 |
30% |
20% |
135.3 |
96.5 |
38% |
10% |
166.2 |
121.2 |
45% |
0% |
197.1 |
146.0 |
51% |
-10% |
228.1 |
170.8 |
58% |
-20% |
259.0 |
195.5 |
64% |
-30% |
289.9 |
220.3 |
70% |
Discount Rate
versus Base Case Pre-Tax NPV Sensitivity Analysis (Pre-Tax)
Discount Rate |
NPV Value (CAD$ million) |
0% |
$197.1 |
5% |
$146.0 |
7% |
$129.6 |
10% |
$108.3 |
Opportunities &
Risks
Opportunities to improve the Lamaque Project economics include
the following:
- The Company is studying a scenario which would involve delaying
the development of the South Ramp by 12-18 months, in order to
reduce up-front capital cost requirements and utilize cash flow
from the North Ramp to fund development of the South Ramp. It is
estimated this could reduce pre-production capital requirements by
as much as $20 to $25 M.
- Acquisition of a mill instead of toll milling would likely
reduce LOM operating costs and allow the Company greater security
in meeting its future milling requirements.
- Potential to utilize contract mining in order to reduce
up-front capital requirements.
- Production outlined in the PEA is limited to a vertical depth
of 620 m at the Triangle Zone. A 2013 drill program intersected
multiple high-grade zones below this level, to depths of up to
1,000 m vertical. The Triangle Zone remains open to the south, east
and west.
- Drilling at the South Triangle Zone intersected 13.89 g/t Au
over 7.0 m, approximately 175 m down-dip from the Triangle Zone
resource estimate (see Company press release dated November 18,
2013). The ground in between the Triangle Zone and this 2013
discovery has not been tested and will be drilled within the next
4-6 weeks.
- The PEA is based on an April 24, 2013, mineral resource
database cut-off date and does not include subsequent drilling,
both infill and expansion, of approximately 29,500 m completed to
the end of February 2014, while drilling is still ongoing with 4
rigs.
- The PEA does not include resources from the No. 6 Vein and the
Sixteen Zone.
- Significant mineralization has been identified at the No. 3
Mine and the No. 5 Plug targets. The Company expects to have
resource estimates completed for those zones in the second half of
2014. Should a resource be defined at these targets they could be
potentially mined from the North Ramp infrastructure.
- Potential for further improvement in gold recoveries based on
results of recent metallurgical test work.
- Potential for reduced milling costs through negotiations with
toll mills
Risks requiring mitigation strategies include:
- Management of construction/engineering and procurement
schedules, costs, and cost containment.
- Operating risks related to recruitment and training of
underground workforce, specifically room and pillar miners.
- Permitting risks.
- Crown pillar thickness and stability evaluation through
geo-mechanics characterization and stability analysis.
Recommendations and Next Steps
The following recommendations have been given as the next steps
of the Lamaque Project. The Company aims to achieve these
objectives in 2014.
- Continue exploration and definition drilling at Parallel,
Triangle and Fortune zones in 2014 in order to upgrade as many
resources as possible from the inferred resource category to the
indicated resource category, while continuing to increase the
resource base laterally and at depth.
- Update the resource estimations for all deposits included in
the PEA and evaluate the impact on the Lamaque Project's economics
using all new information generated since the latest database
cut-off (since April 24, 2013).
- Complete exploration drilling and perform additional resource
estimations on two of the Lamaque Project's advanced exploration
targets, the No. 3 Mine and No. 5 Plug, for integration into the
future economic evaluations on the project.
- Commence a prefeasibility study which will include:
- Hydrogeology study;
- Rock mass characterization and stope design;
- Crown pillar stability analysis;
- Revised mining plan using new resources;
- Trade-off analysis:
- Re-scheduling development of the 2 ramps to limit capital
requirement;
- Energy alternative for underground air heating;
- Mineralized material and waste handling alternatives; and
- Access, possibly via shaft sinking, to deeper part of the
Triangle Zone and No. 4 Plug.
- Finalize connecting scenario to Hydro-Quebec grid;
- Engineering for surface installation, electricity and mechanics
installations;
- Engineering for water treatment and management facilities;
and
- Updated economic evaluation of capital expenditures and
operating costs.
- Initiate and complete the permitting process for an underground
exploration program. A complete prefeasibility study will likely
require underground exploration, meaning a significant portion of
project permitting will be completed during the prefeasibility
stage:
- Apply for Certificate of Authorization;
- Complete application for mining lease for South site
(Triangle);
- Mineralization and waste characterization;
- Hydrology study;
- Noise and vibration study; and
- Biology study.
- Conduct a fourth phase metallurgical study in order to further
improve gold recoveries for the Triangle and No. 4 Plug zones.
- Complete a formal information and consultation process in order
to promote social acceptability of the Lamaque Project and
development plans.
Qualified Persons
The Lamaque Project is under the direct supervision of Hervé
Thiboutot, Eng. Senior Vice-President of the Company, and Francois
Chabot, Eng. and Operations and Engineering Manager of the Company.
Both Mr. Thiboutot and Mr. Chabot are Qualified Persons ("QP") as
defined by National Instrument 43-101.
In addition, each of the individuals listed below are
independent QP for the purposes of NI 43-101. All scientific and
technical information in this press release in respect of the
Lamaque Project or the PEA is based upon information prepared by or
under the supervision of those individuals.
For InnovExplo Inc., Sylvie Poirier, Eng. (Mining) and Laurent
Roy, Eng. (Mining); for Geologica, Alain-Jean Beauregard, Geol.
(Geology) and Daniel Gaudreault, Eng. (Geology); for GeoPointcom,
Christian D'Amours, Geol. (Resources); for Amec, Stephan Bergeron,
Eng. (Environment); for Golder Associates, James Tod, Eng.
(Geo-Mechanics); and for WSP Engineering, Michel Garon, Eng.
(Metallurgy).
The Company's QPs have also reviewed the technical content of
this press release.
Quality Assurance - Quality Control ("QA/QC")
Thorough QA/QC protocols are followed on the Lamaque Project
including insertion of duplicate, blank and standard samples in all
drill holes. The core samples are submitted directly to ALS
Laboratory Group and Bourlamaque Labs in Val-d'Or for preparation
and analysis. Analysis is conducted on 1 assay-ton aliquots.
Analysis of Au is performed using fire assay method with atomic
absorption finish, with a gravimetric finish completed for samples
exceeding 5 g/t Au, or a metallic sieve assay for samples
containing visible gold. When available the gravimetric or metallic
sieve assay results are used for the reported composite
intervals.
Further information about the mineral resource estimate cited in
this news release can be found in an NI 43-101 compliant technical
report for the project, entitled "2013 NI 43-101 Technical Report
on the Lamaque Property", dated November 1, 2013, which is
available under the Company's SEDAR profile at www.sedar.com.
ON BEHALF OF THE BOARD OF DIRECTORS
Stephen de Jong, CEO & President
Follow Integra Gold On:
- Twitter: http://twitter.com/integragoldcorp
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this news release.
Cautionary Note Regarding Forward Looking
Statements:
No stock exchange, securities commission or other regulatory
authority has approved or disapproved the information contained on
this presentation. This presentation contains "forward-looking
information" concerning Integra Gold Corp.'s ("Integra" or the
"Company") future financial or operating performance and other
statements that express management's expectations or estimates of
future developments, circumstances or results. Generally,
forward-looking information can be identified by the use of
forward-looking terminology such as "seeks", "believes",
"anticipates", "plans", "continues", "budget", "scheduled",
"estimates", "expects", "forecasts", "intends", "projects",
"predicts", "proposes", "potential", "targets" and variations of
such words and phrases, or by statements that certain actions,
events or results "may", "will", "could", "would", "should" or
"might" "be taken", "occur" or "be achieved". Forward-looking
statements included in this presentation include statements
regarding the proposed mining scenario for the Lamaque Project,
including information with respect to the expected economic results
of the Lamaque Project (including rates of return, payback period
and the NPV of the Lamaque Project), estimated capital expenditures
and other costs to develop the site, the expected values of gold
for the life of the project, rates of development and production,
potential mineralization and mineral resources, information with
respect to supporting infrastructure, the potential life of mine,
rates of employment and the effects of steps taken to mitigate
local impacts and the expected completion dates of exploration and
drilling, exploration results, estimated and future exploration and
administration expenditures, the completion of a feasibility
studies, and future plans and objectives of Integra. While all
forward-looking statements involve various risks and uncertainties,
these statements are based on certain assumptions that management
of Integra believes are reasonable, including that it will be able
to obtain financing and on reasonable terms, that the PEA will
prove to be materially accurate, that its current development and
other objectives can be achieved, that its development, exploration
and other activities will proceed as expected, that its community
and environmental impact procedures will work as anticipated, that
general business and economic conditions will not change in a
material adverse manner, that Integra will not experience any
material accident, labour dispute or failure or shortage of
equipment, and that all necessary government approvals for its
planned development and exploration activities will be obtained in
a timely manner and on acceptable terms.
There can be no assurance that the forward-looking
statements will prove to be accurate and actual results and future
events could differ materially from those anticipated in such
statements. Important factors that could cause actual results to
differ materially from the Integra's expectations include, among
others, the actual results of development activities being
different than those anticipated by Integra, changes in project
parameters as plans continue to be refined, changes in estimated
mineral resources, future prices of metals, increased costs of
labor, equipment or materials, availability of equipment, failure
of equipment to operate as anticipated, accidents, effects of
weather and other natural phenomena, risks related to community
relations and activities of stakeholders, and delays in obtaining
governmental approvals or financing. Although Integra has attempted
to identify important factors that could cause actual results to
differ materially, there may be other factors that cause results
not to be as anticipated, estimated or intended. There can be no
assurance that such statements will prove to be accurate as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements. Integra does
not intend, and expressly disclaims any intention or obligation to,
update or revise any forward-looking statements whether as a result
of new information, future events or otherwise, except as required
by law.
Corporate Inquiries: Integra Gold Corp.Chris
Gordonchris@integragold.comwww.integragold.com
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