Gold’s remarkable year
Gold truly enjoyed a remarkable 2024, relentlessly powering higher to many new records.
It has been six years since the last new gold mine – Brucejack – went into production in British Columbia.
Now, as many as three could be pouring first gold next year: Premier, Blackwater and Cariboo Gold.
While the Premier and Cariboo Gold mines are brownfield projects with historical mining, the new Artemis Gold Blackwater project south of Prince George is a large greenfield project that will generate a significant number of jobs and economic activity in an area hard hit by sawmill and pulp mill closures.
Combined, the three new mines represent an initial capital investment of C$1.5 billion over the next couple of years, and hundreds of new jobs.
The first of the three new gold mines to go into production will be the Premier underground gold mine near Stewart, B.C. Ascot Resources is aiming to pour first gold by the first quarter of 2024. The capital cost of the project is C$300 million, and much of the new works are already built or nearing completion.
The mine is located within Nisga’a treaty lands. An agreement with the Nisga’a provides the First Nation with cash payments, training, employment and business opportunities. Sprott Streaming is helping to finance the mine with a $110 million gold and silver streaming agreement.
The Premier gold mine has been mined since the early 1900s, most recently as an open-pit operation until the late 1990s, so a lot of the infrastructure needed to operate a mine is in place.
“We have a lot of strategic infrastructure advantages that a greenfield site doesn’t have,” said Ascot CEO Derek White. “That’s why we’re able to go much quicker. We’re benefiting from all the historical infrastructure.”
Ascot has designed a hub-and-spoke approach, with one central mill near the historical Premier mine site, and four distinct deposits, all to be mined underground. The furthest deposit is 44 kilometres away by road.
Since a lot of the infrastructure is already in place, most of the capital investment has been in refurbishing the mill and a tailings pond and water treatment system.
“In 2023, the big things for us are putting in a new state-of-the-art water treatment plant,” White said.
Ascot expects the mine to produce 150,000 ounces a year, with average grades of 7.5 grams of gold per tonne. To put that in context, Blackwater’s average annual production would be just under 400,000 ounces per year with gold grades of 0.75 grams per tonne.
“These are high-grade underground deposits,” White said. “So small volume, high grade.”
Ascot will be ramping up to about 200 workers this summer. Once in operation, the mine will employ 230 to 250 miners. While some of the miners may live in camp at the site, others may end up living in Stewart, B.C., White said.
With an initial capital cost of C$645 million – and up to C$1.4 billion total over a 22-year mine life – Artemis Gold’s Blackwater open-pit gold mine south of Vanderhoof will be largest new mine built in the region in more than a decade. Plus, it is largely locally owned, with 41% of the owners being board members or management, including Vancouver developer Ryan Beedie, who is a director and major shareholder.
“We live here,” said Artemis Gold CEO Steven Dean. “This is our home and our decisions are made here in Vancouver, and not in Toronto or some other head office outside of the province or even outside of the country.”
The Blackwater project was green-lit just last week with the issuance of a Mines Act permit. Early works construction has already started.
“We’re already well into construction,” Dean said.
The Blackwater project will create 500 jobs during an 18-month construction period, with production expected later in the second half of 2024. It will employ 300 miners in the first phase of operation and up to 450 in later phase expansions. The project will expand in phases, with the expansions focused on processing, starting at six million tonnes annually in Phase 1, 12 million tonnes in Phase 2 and 20 million tonnes in Phase 3.
The mine will be in a region of B.C., south of Prince George, that has been hard hit in recent years by sawmill and pulp mill closures, so it will provide a welcome injection of jobs and tax revenue.
“British Columbians will benefit from hundreds of new jobs of this new mine, with both its construction and multiple decades of operation,” said Josie Osborne, minister of energy, mines and low carbon innovation.
“We’re hoping to be able to support employment and re-employment of some of those people in the forestry sector, maybe with a little bit of retraining into our sector,” Dean said. “Whether it be operators, truck drivers, maintenance people in the mill, there are some common skills between the two industries.”
Wheaton Precious Metals is staking the project with a $141 million streaming agreement.
“We think it’s a robust asset that has some potential upside even beyond what they’ve identified so far,” Wheaton CEO Randy Smallwood said. “It looks like a really good asset that will deliver a lot of gold and silver to us. It’s a strong team that’s had great success building other operations and other mines around the world.”
An economic impact study by KPMG estimates the mine will contribute C$13 billion to the B.C. economy over its 22-year life, including C$2.3 billion in provincial revenue.
The Blackwater will have a lean carbon emissions profile. Its processing plant will be fully electric, and therefore zero emission, and the company has an agreement with Caterpillar in which the mine’s haul trucks can switch to fully electric in 2029.
“We have an agreement whereby we will be one of the first to receive these pieces of equipment,” Dean said.
Osisko Development has plans to bring the historic gold mining region of Barkerville back to life. The company had planned to have a new mine in operation last year, but it has been delayed, and the company is now aiming to pour first gold in 2024.
The project has a total capital cost of close to C$600 million – C$137 million for the first phase and $451 million for expansion. In January, Osisko published a new feasibility study that estimates the mine will produce an average 163,695 ounces of gold a year over a 12-year period, with gold grades of 3.72 to 4.43 grams per tonne.
“This feasibility study demonstrates that the Cariboo Gold project will be a large-scale, long-life and profitable gold mine,” said Osisko Development CEO Sean Roosen. “It will also produce significant quantities of gold in its initial years at a capital cost below C$140 million.”
(This article first appeared in Business in Vancouver)
