VANCOUVER — It has been a busy 18 months for Toronto-based junior Carlisle Goldfields (TSX: CGJ; US-OTC: CGJCF) at its wholly owned, 285 sq. km property package across the historic Lynn Lake greenstone belt in northern Manitoba. Carlisle delineated three maiden gold resources following an active exploration campaign in late 2012, which established the foundation for a preliminary economic assessment (PEA) released on Dec. 2.
Carlisle’s open-pit mine plan models a central mill at Lynn Lake that would process ore from four gold deposits at a rate of 10,000 tonnes per day.
Over the past year the company added the Burnt Timber and Linkwood satellite discoveries to its global measured and indicated resources, which total 40 million tonnes grading 2.10 grams gold per tonne for 2.7 million contained oz.
The mine would incorporate Burnt Timber and Linkwood along with the past-producing MacLellan and Farley Lake mines, and carry development costs of $274 million. Lynn Lake would crank out around 175,000 oz. gold annually over a 13-year life assuming an average, life-of-mine grade of 1.94 grams gold. Pre-tax average operating costs are estimated at $659 per oz. net of silver by-product credits.
The operation would carry a pre-tax net present value of $625 million at a 5% discount rate, along with a 34.4% internal rate of return and a 2.4-year payback period. Assuming a base case of US$1,300 per oz. gold, Lynn Lake would generate $604 million in net cash flows.
President and CEO Bruce Reid explained in a prepared statement that the current PEA outlines a more “long-term” development option at Lynn Lake that incorporates its four core deposits, though he pointed out that Carlisle will also be moving forward with a smaller economic study that will be limited to the higher-grade MacLellan and Farley Lake resources. MacLellan holds 8 million measured tonnes grading 2.13 grams gold, while Farley Lake hosts 5 million indicated tonnes at 3.45 grams gold.
In mid-November Carlisle firmed up an option agreement at Farley Lake with fellow junior Canadian Orebodies (TSXV: CO; US-OTC: CNOBF) in order to generate capital for resource drilling. Canadian Orebodies must chip in $800,000 in exploration expenditures by year-end to earn a 10% stake.
Carlisle is consolidating its land position at Lynn Lake. In June the company optioned the Johnson & Johnson property, which Reid described as the “last piece of the puzzle” in the Johnson shear, where Carlisle had prior successes with Burnt Timber and Linkwood.
In order to earn a 100% interest in Johnson, Carlisle must spend $2 million on exploration by June 2016, and make staged-cash payments totalling $2.2 million.
Johnson was previously drilled in the 1980s, with historic data highlighted at the Foster Chopper veins, where hole 87-7 cut 2.8 grams gold and 3.4 grams silver over 5.9 metres.
Carlisle reported $778,000 in cash at the end of August after it completed a $1.45-million private placement in late June, wherein it issued 24.2 million units at a price of 6¢ per unit.
The company has traded within a 52-week range of 4¢ to 17¢, and closed at 4.5¢ per share at press time.
Carlisle has 228 million shares outstanding for a $10.2-million market capitalization.
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