Western Troy controls 100% of the MacLeod Lake Molybdenum-Copper. The project is located approximately 275 kilometers north of Chibougamau, Quebec. Resources have been defined at two locations along a 30 kilometer contact between two geologic units. Most of the remainder of the contact is prospective for the discovery of additional resources.
The Main Zone resource outcrops on surface, is approximately 1.5 by 0.5 kilometers in horizontal dimensions, and has drill fences on 100 meter centres with approximately 220 drill holes in the Main Zone area. An updated 43-101 report on MacLeod Lake was prepared in the spring of 2011. The report and updates are available on SEDAR (click here to view the 43-101 report.)
A Scoping Study (Preliminary Assessment) was completed in March of 2008. The study was prepared by Roscoe Postle Associates, Inc (RPA). of Toronto, Ontario. Using a molybdenum price of US$17.00 per pound and a copper price of US$2.25 per pound, the study indicates a surface mining operation on the Main Zone will generate a pre-tax net present value (NPV using a 10% discount Rate) of C$156 million and a pre-tax internal rate of return (IRR) of 32%.
RPA's estimate of the Mineral Resources for the Main Zone of MacLeod Lake Project, contained within an optimized open pit outline, is summarized in the following table:
| Scoping Study In-Pit Resource | |||
|---|---|---|---|
| Main Zone Indicated | Main Zone Inferred | Pounds / Oz. | |
| Tonnes (mm) | 18.2 | 1.9 | |
| Copper | 0.60% | 0.35% | 217 million |
| Moly | 0.094% | 0.078% | 32 million |
| Gold | 0.06 g/t | 0.04 g/t | 7000 |
| Silver | 4.5 g/t | 3.6 g/t | 800,000 |
| Moly Equivalent Grade - 0.189% | |||
| Average Producer Grade - 0.109% | |||
The Preliminary Assessment based on the above Mineral Resource estimate includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves, and there is no certainty that the preliminary assessment will be realized.
At the anticipated open pit production rate of 6,000 tonnes per day or 2.1 million tonnes per year, the project will provide for a mine life of approximately 9.4 years. Life of mine metal production is forecast to be 217 million pounds of copper, 32 million pounds of molybdenum, 800,000 ounces of silver and 7,000 ounces of gold.
Pre-production capital expenditures are estimated to be C$210 million including:
| Capital (C$ millions) | |
|---|---|
| Mining | $25 |
| Mill and Facilities | 66 |
| Access Road | 14 |
| Power Line | 9 |
| Engineering and Const. Mgmt. | 54 |
| Contingency (25%) | 42 |
| Total Capital | $210 |
The total operating cost, including mining, processing and general/administration, is estimated to be $24 per tonne of ore milled. The open pit will be mined in two phases. Phase 1 will include mining without disturbing the adjacent MacLeod Lake, for a total of 13 million tonnes (Years 1 to 6). Phase 2 involves extending the pit to the east and requires draining a portion of the lake. Phase 2 will total 4.2 million tonnes (Years 7 to 8).
RPA Qualified Persons responsible for the Preliminary Assessment are Normand Lecuyer, P.Eng., Principal Mining Engineer, Reno Pressacco, M. Sc(A), P.Geo., Associate Consulting Geologist, Barry Cook, M.Sc., P.Eng. Associate Consulting Geologist, Kevin Scott, P.Eng., Consulting Metallurgist, and Jason Cox, P.Eng., Senior Mining Engineer.
In early 2009, Western Troy received the final metallurgical study results from SGS Lakefield following a detailed analysis of the MacLeod Lake ore samples. SGS found that Western Troy should expect to recover approximately 96 percent of the copper and 85 percent of the molybdenum at MacLeod Lake. These results are better than the recoveries used in the Scoping Study (92% for copper and 85% for molybdenum). The full report is available at METALLURGICAL FEASIBILITY STUDY TESTWORK ON MACLEOD LAKE ORE, February 2009, written by SGS Lakefield Research Limited.
Access to the project area is currently limited to aircraft and snowmobile. A winter road exists from Temiscamie to the Eastmain Mine. On May 9, 2011 Quebec Premier Jean Charest announced his "Plan Nord," a major intitiative to develop northern Quebec. Plan Nord is a huge program that will cover 25 years and involve $10 billion in infrastructure spending. Economic benefits totaling $80 billion are projected. The initial phase of Plan Nord includes full funding and a construction schedule for the Otish Mountain Road which will pass within 70 kilometers of the MacLeod Lake Project. Construction is expected to commence in late 2011 or early 2012. The cost to build a spur road from the Otish Mountain Road is included in the economic evaluations of the MacLeod Lake Project.
An additional item in the initial phase of Plan Nord is $500 million for equity investments in northern Quebec resource projects. Western Troy has held initial meetings with Investissement Quebec, the organization charged with adminstering the $500 million fund, to discuss potential participation in the MacLeod Lake Project.
Western Troy contracted with GENIVAR to perform the "bankable" feasibility study and environmental permitting for the MacLeod Lake Project. The feasibility study is expected to be completed in the first quarter of 2012 and the environmental permitting work is scheduled for completion in early 2013. Depending on project financing and equipment lead times, mine construction could begin in 2013 with first production to follow in 2015 or 2016. Map DataMap data ©2011 Europa Technologies Imagery ©2011 TerraMetrics - Terms of UseMap DataCloseMap data ©2011 Europa Technologies Imagery ©2011 TerraMetrics
