KORE Mining (TSXV: KORE) has won a favourable court ruling that would allow the company to proceed with drilling at its Long Valley gold project in Mono county, California.
On Tuesday, the US District Court for the Eastern District of California denied a motion by NGOs to overturn authorization granted by the United States Forest Service (USFS) of KORE’s proposed drill program. A phase 1, 3000-metre program was previously approved by the USFS in October 2021.
To date, KORE had voluntarily limited any work at the Long Valley project pending the outcome of the court case between the NGOs and the USFS. Now that the USFSs motion for summary judgement has been granted and the authorization upheld, KORE intends to proceed with exploration during the summer and fall of 2023.
KORE said its team has worked closely with the USFS to avoid cultural impacts and mitigate other potential impacts of drilling. The program is expected to use modern technology and existing road infrastructure to minimize disturbances, KORE said, adding it will also complete pre-disturbance cultural surveys, remove 100% of all drill cuttings, have zero water or waste discharge and intensively remediate all sites post-work.
There will be no long-term impact from the program and no permanent installations will be left behind, KORE has said. The USFS thus granted KORE a categorical exclusion from the National Environmental Protection Act for the plan of operations.
Details of the Long Valley exploration drill program will be provided by the company over the coming weeks.
The company has identified opportunities to expand the shallow oxide mineralization in all directions. Additional mineralization could extend mine life, reduce capital intensity and generate higher project economic returns than the 1.2 million oz. of indicated gold and 500,000 oz. of inferred gold from 64 million tonnes of 0.58 g/t and 22 million tonnes of 0.65 g/t, respectively, as modelled in the October 2020 preliminary economic assessment.
According to the PEA, the project would generate a post-tax net present value of $273 million (at a 5% discount) with an internal rate of return of 48%, based on a $1,600/oz. gold price. Production is expected to average 102,000 oz. of gold per year over a seven-year mine life.
As a fully intact epithermal deposit with a large at surface footprint, Long Valley has the potential for high-grade sulphides and discrete vein zones in the underlying feeder structures.
The discovery of high-grade, sulphide dominant gold-silver mineralization in addition to near-surface oxide mineralization would open up additional development pathways for the project, such as underground mining, KORE said.
Shares of KORE Mining shot up by 50% by 12:30 p.m. ET following the announcement. The company’s market capitalization stands at approximately C$8 million ($5.9m).