AuRico gets federal enviro nod for multimillion-ounce Kemess project

VANCOUVER (miningweekly.com) – Precious metals royalties firm and project developer AuRico Metals has received a positive decision statement from the Canadian Environmental Assessment Agency (CEAA), prompting the British Columbia Environmental Assessment Office (EAO) to grant an environmental-assessment certificate for the company's 100%-owned Kemess underground project.

"These positive decisions are the culmination of a comprehensive process which began in 2014 . . . The Kemess underground project presents an attractive development opportunity given its strong economics – supported by existing infrastructure, large scale, good jurisdiction and advanced stage,” president and CEO Chris Richter stated.

The EAO managed the environmental assessment for the Kemess underground project in a substituted process on behalf of British Columbia and CEAA, the latter of which is on behalf of the federal government of Canada. The project will require several other normal-course licences and permits, which are expected to be received early in 2018. 

The Kemess project has about $1-billion of existing infrastructure on care and maintenance on site, which will dramatically reduce the expected capital expenditures to first production to just under $400-million.

The Kemess underground project and the Kemess East deposits currently hold about 3.34-million ounces of gold in the proven and probable mineral reserve categories, 6.66-million ounces gold in the indicated resource category, and another 2.26-million ounces in the inferred category.

AuRico believes there is significant exploration upside, especially at Kemess East, where the deposit remains open in several directions.

A 2016 feasibility study on the project calculated a net present value, at a 5% discount, of C$421-million, with an internal rate of return of 15.4%.