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Wellgreen Platinum’s open pit and underground mine plan

Wellgreen Platinum (TSX:WG) is planning both an open pit and underground mine at its its Yukon-based PGM and nickel project says CEO Greg Johnson.

The company filed a preliminary economic assessment in the spring. If developed Wellgreen would be a mid-tier level producer averaging more than 200,000 ounces of platinum, palladium and gold annually (42% Pt, 51% Pd and 7% Au), along with 73 million pounds of nickel and 55 million pounds of copper over the first 16 years of operation.

The property has been explored by past project owners. Johnson says exploration data makes both underground and open pit operations work.

“[It] allows us to go after higher grade material pretty rapidly in the mine plan without a lot of capital investment,” says Johnson.

“And that can be attractive in terms of increasing your grades. Or even exploring for some of that higher grade material that could be deeper than what you could get at relatively quickly in the mine.”’s tour of the Wellgreen project was underwritten and hosted by Invest Yukon.

Wellgreen is located in Canada, 317km NW of Whitehorse. It is considered to be a magmatic sulfide deposit. Image courtesy of IntelligenceMine. Thank you for the tour. Can you tell me about the history of the project, how it came to be?

Greg Johnson: It is an interesting project. It was discovered all the way back in the 1950s when the Alaska Highway was being built. It’s had a history of development since it was put into production in the 1970s by Hudson Bay Mining Company, as a high grade underground mine. Since that point it has been looked at by a number of groups as a large scale potential open pit operation, which is the focus for Wellgreen. I understand there is significant historical drill results. You also have placer operations in the area.

Greg Johnson: It’s an area that has had extensive placer mining. It is a really good indicator that you have metals. In addition we have some excellent work that has been done by previous companies that we can build on in terms of looking at the core, analyzing it with our current methods, techniques and determining what those past drill holes mean in the context of a bulk mineable project. What’s the geology of the area?

Greg Johnson: We are looking at a system that is hosted in ultramafic rocks. So these are relatively rare, geologically. Most of the world’s platinum, palladium is produced in South Africa, where the biggest concentrations of these types of deposits occur and also in Russia. There are a couple of deposits in Canada, but it is quite rare to find this rocks and enrichment in the platinum group metals and nickel in Wellgreen.

Drilling underway at Wellgreen’s project, August 2015. You said that the rocks contain a multitude of elements that would be of interest. It was platinum group, gold and you had some base metals in there.

Greg Johnson: Yes, we refer to these types of rocks as polymetallic because they have multiple metals. The asset it, as we look at it, it will be a significant nickel and platinum group metal producer so those co-occur and they would be produced together. Our end product will most likely be a concentrate where you basically grind up the rock material and you separate out the metal bearing elements into product that is shipped to a smelter for final process. How would you transport the concentrate and what smelters would it go to?

Greg Johnson: There are eight large smelters globally. There are about five here in the North America. There is a couple in Europe. We would be looking to ship our concentrate out of port to the south of us in Alaska. That’s a year round, ice-free port. We would then take that to whichever of those major smelters made the most sense in terms of taking our product. You have looked at other mines in developing your mine plan. What are some of the models that you are using?

Greg Johnson: There are a number of mines that would be similar. Our project is similar to copper/gold deposits, such as we see in Western Canada. Why is it similar?

Greg Johnson: The scale of mining and the approach to mining. So you are looking at an open pit operation in our initial concept that’s about 25,000 tonnes per day. So that is trucks and shovels that is hauling that material to be ground and produce a floatation concentrate. Operationally it is very similar to some of the mines in Finland, which process both nickel and PGMs. There is a recent operation by First Quantum that we look at as being very similar to Wellgreen called Kevitsa. And that’s a mine that we looked at in terms of how they were approaching mining and that went into our most recent economic assessment update. You also have hires that have worked on mines that would be similar to Wellgreen?

Greg Johnson: That’s right. Our chief operating officer has spent better part of his career working in the Sudbury Basin, where there are similar nickel/PGM deposits. So we were able to utilize his experience in these rocks, engage some of the leading experts in mineral processing and bring those folks who have worked on a number of projects around the world to take a look at the Wellgreen system and to really optimize the recovery of the metals. In your mine plan, you said there were two aspects, it will be open pit, but you will also be going underground.

Greg Johnson: We have an opportunity at Wellgreen because of the historic underground mining from HudBay, we have four different levels and about four kilometres of underground workings that are already in existence. So from an open pit point of view it allows us to go after higher grade material pretty rapidly in the mine plan without a lot of capital investment. And that can be attactive in terms of increasing your grades. Or even exploring for some of that higher grade material that could be deeper than what you could get at relatively quickly in the mine. What’s it like working in the Yukon?

Greg Johnson: The Yukon is a great jurisdiction to be working in. It’s very pro development, pro mining. The government has recently announced improvements to the overall permitting process in terms of certainty, clarity and timelines. We find them to be very supportive of our industry.

Wellgreen CEO Greg Johnson in the core shack.