The Macassa Property is an underground gold mine located in the Municipality of Kirkland Lake, Ontario, Canada. Kirkland Lake has an illustrious history of gold mining, producing over 25 Moz since 1914. Underground mining at Macassa commenced in 1933 and has since produced 5.2 Moz. The deposit is situated on Abitibi Greenstone along the Kirkland Lake-Larder Lake Break and its splay faults and fractures, extending from Matachewan to Larder Lake. Agnico Eagle owns the property rights to Macassa and the four former producers along strike, providing unrestricted mineral exploration opportunities in the area.
Ore at Macassa is extracted via overhand/underhand cut & fill and longhole in steeply dipping areas. Seismic risk is managed via pillarless mining, top down, with pastefill. Mining currently focuses on three areas, New South, Lower North, and Main Break; 05 Narrows is to be mined in the final year of mine life. Until the new #4 Shaft is operational, operating cost averages C$388/t. This results in an elevated Resource cutoff grade of 8.57 g/t at C$1,635/oz. Reserve cutoff is analyzed on a stope by stope basis. Planned throughput is 1,000 tpd at 21.5 g/t for the next three years, producing 252 koz per year. Tonnage is expected to double once the new shaft is in use.
Two LOM plans are presented in the Technical Report. The first LOM reports stopes from Reserve and economically viable M+I Resources. It cannot be determined whether the entire 2.25 Moz Reserve is extracted with an additional 64,000 oz from M+I Resource, or if more M+I is included and a portion of Reserve left out. The second LOM applies a conversion factor of 75% for M+I and 50% for Inferred Resources to generate economically viable stopes. Of particular note, is the conversion of Inferred Resources. This category does not carry sufficient geological understanding to be classified as Reserve; while the report does not mistakenly classify them as Reserve, they are included as stopes in the mine plan. Perhaps the objective here may be to present the two scenarios and strike a balance between economic uncertainty and geological uncertainty.
| Life of Mine Scenario | Tonnes (‘000 t) | Grade (g/t) | Ounces (‘000 oz) |
|---|---|---|---|
| Reserve and Economic M+I Resource | 3,377 | 21.3 | 2,314 |
| Resource Conversion (75% M+I, 50% Inferred) | 5,022 | 19.0 | 3,072 |
| Classification | Tonnes (‘000 t) | Grade (g/t) | Ounces (‘000 oz) |
|---|---|---|---|
| Reserve | 3,190 | 21.9 | 2,250 |
| Resource (M+I) | 1,787 | 17.1 | 982 |
| Inferred | 610 | 16.7 | 328 |
The Macassa Property contains 2,250 koz Reserve and 982 koz M+I Resource at high grades. Although grades are eye-watering, this excitement is tempered by high costs. In addition to geotechnical challenges, risks remain in the definition of Mineral Resources and Reserves in mine planning. #4 Shaft will be a watershed moment for the operation, providing a new production profile and associated cost structure. The excess capacity will deliver increased operational flexibility, growth, and risk reduction for the LOM plan.
The information presented above does not constitute investment advice. This is a summary from the NI43-101 Technical Report effective July 19, 2019 (INSERT), with commentary from the author. Statements above do not represent the views of Agnico Eagle. If any discrepancies arise, the information contained within the NI43-101 are official and final. For latest depletion data, please refer to the AIF update.