Argonaut Gold has discovered four new, high-grade gold zones at its past-producing Magino gold project in Ontario. These four zones – Scotland, #42, Sandy and South – are either below or adjacent to the planned Magino pit boundaries and lie between 350 and 700 metres southwest of the known Elbow zone.
Drill highlights include 7 metres of 14 g/t gold from Scotland starting at 431 metres; 8 metres of 9.3 g/t gold from #42 starting at 365 metres; 9 metres of 5.4 g/t gold at Sandy from 741 metres; and 7 metres of 4.2 g/t gold at South from 884 metres.
According to Pete Dougherty, Argonaut’s president and CEO, these new zones speak to the exploration upside at the brownfields site.
“The discovery of these four new high-grade zones below the planned Magino open pit demonstrates the exploration potential of the Magino project,” Dougherty said in a release.
“These results continue to demonstrate the high-grade gold potential at the project. Importantly, we have now demonstrated results at depth farther westward from the boundary between Magino and the adjacent Island Gold mine (held by Alamos Gold).”
Since starting an exploration program at Magino in July 2019, the company has drilled 48,000 metres at the property. The recent work involved widely spaced scout drilling, testing for high-grade structures at depth, west of the Elbow and Central zones. Drills will now test the continuity of these existing zones, and target new areas of mineralization below and west of the planned pit.
“Through an ongoing structural investigation over the past two years, we can now trace higher-grade ore shoots within the planned open pit and test the down dip potential of these structures,” said Brian Arkell, VP of exploration.
Arkell also added that the company plans to continue with drilling of the six prospective targets (the four areas announced today, plus the Elbow and Central zones).
In mid-October, the company announced that it would be going ahead with the construction of the Magino gold project. Based on an anticipated two-year construction period, starting in January 2021, Argonaut anticipates the first gold pour from the asset in the first half of 2023.
A 2017 feasibility for Magino outlined a 10,000 t/d open pit operation with a 17-year mine life, producing an average of 150,000 oz. of gold in the first five years at all-in sustaining costs of $711 per oz. The resulting project net present value estimate, at a 5% discount rate, came in at $288 million.
This year, the company expects to generate 200,000-215,000 oz. of gold-equivalent at all-in sustaining costs (AISCs) of $1,225-1,350 per ounce. This total includes contributions from open pit mines in Mexico, as well as from the Florida Canyon heap leach site in Nevada.
(This article first appeared in the Canadian Mining Journal)