The Meliadine Project is a gold deposit situated in Kivalliq, Nunavut, Canada. The property does not have a history of mining and as of the effective date of the report, no commercial gold production has occurred. The deposit is situated in the northern portion of the Archean Rankin Inlet Greenstone Belt. The supercrustal rocks consist of polydeformed and metamorphosed mafic volcanic, felsic pyroclastic, sedimentary, and gabbro sills.
The Meliadine Project is composed of surface and underground deposits. It is expected that 3.4 Mt will be extracted from open pit and 9.1 Mt will be extracted from underground for the Life of Mine. An additional 1.4 Mt marginal ore will be stockpiled for processing at the end of mine life. The underground is planned for 3,000 tpd and starting Year 4, the pit will supply an additional 2,000 tpd of ore. Two pits are planned using a gold price of US$1,200/oz at an exchange rate of C$/US$ 1.03. At a cost of C$85.64/t, the pits have a cutoff grade of 2.36 g/t. Planned with inter-ramp angles of 48° to 49°, the pits have maximum depths of 100 m and 150 m. It is conceptualized that the pit will mine out the crown pillar, with pit bottom sitting directly above the pastefilled stopes underground. The underground mine is expected to produce ore at a grade of 8.89 g/t gold. Ore will be extracted using 25 m high longhole stopes, using a combination of pastefill and unconsolidated rock fill. Underground reserves use a gold price of US$1,150/oz to provide a cutoff grade of 4.80 g/t at a cost of C176.44/t-milled.
Meliadine averages 326 koz gold per year for the first three years, and 397 koz gold per year from Year 4 to Year 8. The LOM average cash cost is C$610/oz. Using a gold price of US$1,300/oz and C$/US$ exchange rate of 1.15, the project generates an after-tax undiscounted cash flow of C$857 M and NPV5% of C$307 M with an IRR of 10.3%.
| Classification | Tonnes (‘000 t) | Grade (g/t) | Ounces (‘000 oz) |
|---|---|---|---|
| Reserve | 13,944 | 7.44 | 3,335 |
| Resource (M+I) | 20,246 | 5.06 | 3,293 |
| Inferred | 14,083 | 7.65 | 3,464 |
Meliadine has a substantial 3.3 Moz Reserve and a 3.3 Moz M+I Resource with additional Inferred Resources of 3.5 Moz, all at good grades. Meliadine has relatively high costs due to its remote location. This reflects in the long pre-production period negatively impacting NPV. Increased gold prices and weakened Canadian Dollar have positive impacts on the project, likely reducing cut-off grade and increasing the Resources and Reserves of the project. Project economics are also likely better than what is featured in this Technical Report.
The information presented above does not constitute investment advice. This is a summary from the NI43-101 Technical Report effective Feb 11, 2015 (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.