SPRINGDALE, N.L. — Representatives of Marathon Gold believe they have a real nugget in its Valentine Lake project.
Sherry Dunsworth, the company’s senior vice-president of exploration, and Robert Borst, project manager, were keynote speakers at the Springdale Chamber of Commerce luncheon earlier this month. They also attended the 31st Annual Mining Conference in Baie Verte.
While Anaconda Mining has garnered a lot of attention for its operations in the Baie Verte area, they claim the Valentine Lake operation has potential to be 10 times that of Pine Cove.
Valentine Lake is located about 80 kilometres off a dirt road accessed from Millertown in central Newfoundland. While it is still in the advanced stages of exploration, the company is preparing to move forward with production.
An independent preliminary economic assessment study was released last month. It provided an assessment of developing the gold camp mineral resource by open pit mining and gold recovery by a combination of milling and leaching.
While the operation generates $3 billion in revenue, the summary stated a pre-tax net present value (NPV) of $758 million (Canadian) and after-tax value of $466 million. The annual average production of gold is 188,500 ounces with a mine life of 11 years.
“We are very excited about it,” Dunsworth said of the assessment. “Springdale has been a very important part of our growth in gold exploration, and what we have found to date, and what we are going forward with as well.”
Local businesses have played an instrumental role in their operation thus far, she told the delegation at the chamber luncheon. That operation covering 24,000 hectares has grown substantially since it began in 2010, she said.
The Leprechaun deposit has about a million ounces of gold and the Marathon deposit has over two million ounces, while there are also smaller deposits throughout, according to Dunsworth.
“There is a lot of potential for more gold, and I am not just saying that flippantly, it is very, very true,” she said. “We are really excited about this project for not only where we are now with 3.2 million ounces, but the potential for growth.”
Good grades of gold are being found, she said, at around two grams per tonne for the open pit, while they have the grades to mine underground too.
Essentially, the more drilling they do, the more gold they find, according to Dunsworth.
“Our discovery is about $10 per ounce,” she said. “When you think an ounce of gold right now is about $1,300 US and it is costing us about $10 to find it, that gives you an idea of how very economic we are and how careful we are with our investors’ money.”
Borst said the operation will employ about 350 people annually from years two-eight, with about 200 people at any given time at camp. Most of the jobs would be operators, he said. He expects construction to continue until the end of 2020 and production in early 2022.
The province benefits directly through taxation, he said, and indirectly through contractors, security personnel and suppliers.