Vancouver – Pretium Resources (PVG-T) has boosted gold and silver resources at its flagship Brucejack project in northwestern British Columbia by as much as 460% following a 72,000-metre drill program this summer.
The high-grade gold resource at Brucejack that is currently targeted for underground mining showed the biggest level of improvement, rising to 5.06 million oz. gold measured and indicated and 3.33 million oz. gold inferred in an updated resource estimate released on Nov. 28. This is up significantly from the 2.8 million oz. gold reported across all categories in the previous estimate in February 2011.
The high-grade oz. are contained in 9.3 million measured and indicated tonnes grading 16.92 grams gold per tonne and 105.6 grams silver per tonne, as well as 4 million inferred tonnes grading 25.67 grams gold and 20.6 grams silver, all based on a 5-grams-gold-equivalent per tonne cut-off grade. All told, silver credits in the high-grade underground zones add up to around 31.6 million oz. M+I and 2.7 million oz. inferred.
The updated resource estimate is based on 1,190 diamond drill holes which have outlined seven modeled deposits at Brucejack, including the SG, Gossan Hill, Galena Hill, West, Bridge, Shore and the Valley of the Kings zones.
Much of the focus for this summer’s drill program was on delineating and expanding the recently discovered Valley of the Kings zone, which is one of the main lodes targeted for underground mining. One of the first holes drilled by the company in 2011, SU-115, exemplified the success of the program when it intersected 18,775 grams gold over 0.6 metre, a record high grade for the property.
While neighbouring gold deposits that are comparable in size with Brucejack such as Seabridge Resources‘ (SEA-T, SA-N) massive KSM gold project or Pretium’s own Snowfield gold-silver project are probably best described as gold-enriched copper porphyry systems, most of the mineralization at Brucejack has been classified as an epithermal gold-silver-copper system with low sulphidation. The 90,000-hectare project is located approximately 65 km north of Stewart and is only few dozen km away from Canada’s highest-grade gold mine, Eskay Creek, which closed down in 2008.
Pretium’s current plan is to start underground mining at the property as early as 2015 targeting the higher-grade, gold-rich veins located at relatively shallow depths of around 400 to 500 metres, followed by open-pit mining of the larger bulk-tonnage gold-silver mineralized envelope.
This envelope, when taken using a low cut-off grade of 0.3 gram gold-equivalent per tonne and not constrained by an optimized pit shell, contains 305 million tonnes grading 1.31 grams gold and 13.4 grams silver for 12.89 million oz. gold and 131 million oz. silver, as well as 813 million tonnes grading 0.7 gram gold and 7.7 grams silver for another 18.2 million oz. gold and 201.2 million oz. silver. Combined across all categories, the Brucejack project now hosts a remarkable 31 million oz. gold and 333 million oz., up from 20.8 million oz. gold and 267 million oz. silver in February 2011.
One idea Pretium has been pushing around is to mine only the higher-grade portions of Brucejack’s larger mineralized envelope, which would drastically reduce tonnage but aid manageability. As Pretium’s president and CEO, Robert Quartermain, told attendees of a Vancouver mining event earlier this month, “If we take a one-and-a-half or one-and-a-quarter-gram cut-off, we get down to about one hundred ten million tonnes of two-gram material. We think that’s the kind of situation you’re seeing with Detour Lake and with Osisko, and that’s the next opportunity that we’ll be looking at above and beyond the high grade, which we’re currently focusing on.”
Using a cut-off grade of 1.25 grams gold-equivalent constrained within an optimized pit shell, measured and indicated resources in the updated resource now stand at 74 million tonnes grading 3.55 grams gold and 33.6 grams silver for 8.4 million contained oz. gold and 80 million oz. silver, plus 78 million inferred tonnes grading 2.68 grams gold and 16.3 grams silver for another 6.7 million oz. gold and 41 million oz. silver.
Concerning the updated resource estimate, Quartermain commented in a prepared statement, “Since acquiring Brucejack 11 months ago, we are very pleased with the substantial progress we have made in outlining the potential for a high-grade underground project.” Indeed, the project has come a long way since its original discovery in the 1960s by Granduc Mines. An initial resource estimate for the project in 2001 reported total resources of around 500,000 oz. gold, and a later estimate by Silver Standard in 2009 tallied approximately 9 million oz. gold.
Pretium says its next steps are to complete an update to the preliminary economic assessment for Brucejack released in June 2011 using the new resource estimate; begin a feasibility study for the high-grade underground portion of the project; and begin work on a revamped PEA for an integrated underground and bulk-tonnage project at Brucejack, planned to commence later this quarter.
At presstime on Nov. 28, shares of the company had gained 20.4% or $1.71 to $10.09 on 288,000 shares traded. Pretium currently has a 52-week share price range of $5.75-$14.19 and a market cap of approximately $730 million.