Armistice Resources Corp said it plans to move the McGarry gold project in Ontario aggressively towards production, based on the results from the NI 43-101 compliant technical report for the project.
President and CEO Todd J Morgan noted that because of the extensive infrastructure in place "we are able to start work immediately," adding this represents a "significant milestone toward full production allowing us to take advantage of the current gold cycle."
A scoping study to determine the potential production between the 1,250-foot and 2,250-foot levels has concluded that an operation starting at 350 tons-per-day and ramping up to 600 tons-per-day could give the mine 4.5 years of production between these levels.
The latest report estimates an indicated mineral resource of 374,000 tons at a grade of 0.25 grams of gold per ton for 93,000 ounces of gold above the 2,300 elevation. The inferred resource above that level stands at 59,000 tons at 0.19 g/t gold for 11,000 oz.
Armistice is conservatively expecting metallurgical recoveries of 85 percent along with gold selling at CDN$800 per ounce and, after a year of production, revenues from custom milling would produce sufficient income to cover ongoing operating costs.
A detailed sampling programme has given support to a conclusion that gold zone continuity of 100 feet along strike and 200 feet along plunge while maintaining minimum mining widths of five feet can reasonably be expected, the company said.
Once a successful mining operation is established with this programme, the next phase will be to expand the project towards surface and to depths in the 5,000 to 6,000-foot range.
The estimated cost of the first 12 months of the programme is CDN$9-15 million.