Proceeds of this financing will be used for the development of the company’s Elk gold project, which began production last fall and is currently undergoing resource expansion drilling. The company has already successfully upgrade the project resource through two phases of drilling, and is now in the midst of a Phase 3 program.
Located 57 kilometres from Merritt in south-central B.C., the Elk gold property contains as many as nine mineralized zones, covering a total area of over 21,000 hectares. Their combined resources are estimated at 4.36 million tonnes grading 5.8 g/t gold-equivalent (806,000 oz.) in the measured and indicated category, plus 1.49 million tonnes grading 5.4 g/t gold-equivalent (262,000 oz.) in the inferred category.
According to a 2020 preliminary economic assessment (PEA), the Elk gold project has a post-tax net present value of C$231 million, using a 5% discount rate. All-in sustaining costs, based on $1,600 per oz. gold, are projected at $554 per oz.
The project was acquired by the company in May 2019, when it was operating under the name Bayshore Minerals, from Equinox Gold (TSX: EQX).
