The Yukon junior that has walked right up to the finish line
Victoria Gold’s Eagle project (CVE:VIT) is just waiting on its water license and then it will be fully permitted says CEO John McConnell.
The Eagle project, located in central Yukon just 40 km northeast of Mayo, has reserves of 2.3 million ounces of gold. Expected production is about 200,000 ounces of gold annually at an operation cost of approximately $600 per ounce.
McConnell talked with MINING.com about the project and the financing piece that will be required to turn Eagle project into a mine.
“The capital cost is $400 million. That’s the big impediment right now in these markets,” said McConnell.
“It’s tough to raise that type of money to a mine into production. We think there is light at the end of the tunnel and hopefully we will be making some announcements later this fall.”
MINING.com’s tour of Eagle project was underwritten and hosted by Invest Yukon.
MINING.com: What is Victoria Gold?
John McConnell: Victoria is a public company listed on the Venture Toronto Stock Exchange. Market cap is about $50 million. Our flagship project is called Eagle.
MINING.com: What is the current status of the project?
John McConnell: The project is in development. We are fully permitted for construction. Within the next four to six-weeks, we should have our water license, which makes us fully permitted for construction and operation.
MINING.com: What’s going to be needed to put a mine on this site?
John McConnell: The capital cost is $400 million. That’s the big impediment right now in these markets. It’s tough to raise that type of money to a mine into production. We think there is light at the end of the tunnel and hopefully we will be making some announcements later this fall.
MINING.com: What are some of the possible options?
John McConnell: We think the project has debt capacity in the order of $250 million. That would leave a gap of $150 million, which would traditionally come out of the equity market. There are some other opportunities, potentially bringing a joint venture partner. We could sell a gold stream. We are in the fortunate position that we have over $14 million in cash so we don’t have a gun to our head to do anything that will hurt our current shareholders.
MINING.com: I believe that Kinross is one of your largest shareholders and you do some work with them on Fort Knox?
John McConnell: Yeah, Kinross has been a shareholder going back to 2007. They have been great. They have participated in all of our financings. But more importantly they have given us access to their Fort Knox mine in Alaska, which is a twin sister to Eagle, both in terms of topography, climate, mineralization, grade. They have allowed us to see their operation go from construction of the heap leach right through into production. They have also allowed us to bring regulators and community members over to see an actual operating heap leach mine.
MINING.com: Can you talk about the First Nations in the area?
John McConnell: Our local First Nation is the Na-Cho Nyak Dun. We are right in the center of their traditional territory. We signed a comprehensive agreement with them over three years ago now. We have a very good close working relationship. And they are our partners on this going forward.
MINING.com: What is it like working in the Yukon and why you decided on this project?
John McConnell: I have spent 90% of my career working in Canada’s north—north of 60, Nunavut and then NWT and now I am here in the Yukon. I love the Yukon. It’s got great people, great characters, great weather. It is a fun place to live and work.