Canada

Cape Ray Project

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Overview

Mine TypeOpen Pit & Underground
StagePreliminary Economic Assessment
Commodities
  • Gold
  • Silver
Mining Method
  • Truck & Shovel / Loader
  • Longhole stoping
Mine Life7 years (as of Jan 1, 2020)

Owners

SourceSource
CompanyInterestOwnership
Matador Mining Ltd. 100 % Indirect
Matador owns 100% of the Cape Ray Gold Project.

Contractors

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Deposit type

  • Vein / narrow vein
  • Mesothermal

Summary:

The Cape Ray Shear Zone forms a structural boundary between the Late Precambrian-Early Palaeozoic Dunnage and Gander tectonostratigraphic zones that define the geology of western Newfoundland.

Mineralisation in the main drilled portion of the Project area occurs as quartz veins and vein arrays either along or as splays off the main Cape Ray Shear Zone. The gold bearing quartz veins, which are typically tabular, locally stacked and dip steeply towards the south-east, typically develop within sediments at or near the contact with footwall graphitic schist or granitoids. Mineralisation extends to the surface with little or no overburden present in what is essentially a glacial-stripped terrain. At Window Glass Hill, gold-mineralisation is present in flat-lying sheets that are developed within a large altered granitic intrusive known as the Window Glass Hill Granite.

The Cape Ray Project lies within the Cape Ray Fault Zone (CRFZ), which acts as a major structural boundary and hosts the Cape Ray Gold Deposits consisting of the 04, 41, and 51 Zones, Window Glass Hill, Big pond and Isle Aux Mort.

The CRFZ is approximately 100km long and up to 1km wide extending from Cape Ray in the southwest to Granite Lake to the northeast.

Hosted by the Cape Ray Fault Zone are the Cape Ray Gold Deposits consisting of three main mineralised zones: the 04, the 41 and the 51 Zones, which have historically been referred to as the “Main Zone”. These occur as quartz veins and vein arrays along a 1.8 km segment of the fault zone at or near the tectonic boundary between the Windsor Point Group and the Port aux Basques gneiss.

The gold bearing quartz veins are typically located at or near the southeast limit of a sequence of highly deformed and brecciated graphitic schist. Other veins are present in the structural footwall and represent secondary lodes hosted by more competent lithologies.

Gold bearing quartz veins at the three locations are collectively known as the “A vein” and are typically located at (41 and 51 Zones) or near (04 Zone) the southeast limit of a sequence of highly deformed and brecciated graphitic schist of the WPG. The graphitic schists host the mineralisation and forms the footwall of the CRFZ. Graphitic schist is in fault contact with highly strained chloritic schists and quartzsericite mylonites farther up in the hanging wall structural succession.

The protolith of these mylonites is difficult to ascertain, but they appear to be partly or totally retrograded PABG lithologies. Other veins (C vein) are present in the structural footwall and represent secondary lodes hosted by more competent lithologies.

In the CRGD area, a continuous sequence of banded, highly contorted, folded and locally brecciated graphitic schist with intercalations of chloritic and sericitecarbonate schists and banded mylonites constitutes the footwall and host of the mineralised A vein. The banded mylonites are characterized by cm-wide sideritemuscovite-quartz-rich bands within graphitic chlorite-quartz-muscovite schist. The mylonites are commonly spatially associated with local Au-mineralised quartz veins, vein breccias (C vein) and stringer zones.

The graphitic schist unit becomes strongly to moderately contorted and banded farther into the footwall of the fault zone, but cm- to m-wide graphitic and/or chloritic gouge is still common. The graphitic schist unit contains up to 60% quartz or quartz-carbonate veins. At least three mineralised quartz breccias veins or stockwork zones are present in the footwall of the 41 Zone and these are termed the C vein. The thickness of the graphitic-rich sequence ranges from 20-70m but averages 50-60 m in the CRGD area.

The CRGD consists of electrum-sulphide mineralisation that occurs in boudinaged quartz veins within an auxiliary shear zone (the “Main Shear”) of the CRFZ. The boudinaged veins and associated mineralisation are hosted by chlorite-sericite and interlayered graphitic schists of the WPG, with sulphides and associated electrum occurring as stringers, disseminations and locally discrete massive layers within the quartz bodies.

The style of lode gold mineralisation in the CRGD has characteristics in common with mesothermal gold deposits. The relationship of the different mineral zones with a major ductile fault zone, the nature of quartz veins, grade of metamorphism, and alteration style are all generally compatible with classic mesothermal lode gold deposits.

The control on mineralization of the 04 Zone consists of four parallel shear zones associated with a graphitic schist unit. These vein-type orebodies are oriented at an azimuth of approximately 50° and dipping at approximately 60° to the southeast.

The controls on mineralization of the 41 Zone consist of 3 types of mineralized orebodies: a set of parallel veins made up of 2 larger veins and 7 smaller veins, a chloritic schist located on the periphery of the mineralized area, and a graphitic schist located in the core of the mineralized area. These mineralized units are oriented at an azimuth of approximately 50° and dipping at approximately 60° to the southeast.

Reserves

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Mining Methods

  • Truck & Shovel / Loader
  • Longhole stoping

Summary:

Mining is proposed to be completed by conventional open pit mining practices. A small underground operation has also been assumed to occur from the base of two of the pits (04/41 and 51) once the open cut mining has been completed in these areas. This underground only accounts for 6% of the total production.

The parameters associated with the Whittle pit optimisations and open-cut mine operation are as follows:
- Dilution managed by applying a waste dilution skin halo around the orebody (average 22% grade dilution)
- Pits at 04/41, 51, PW, WGH and IAM
- Pit slopes – 50deg

The open pit design completed for Cape Ray contains the following features:

Zone 04
- Reaches a maximum depth of ~210m below surface.
- Contains a single 14m wide spiral ramp system to reach the base of the pit at 115mRl.
- Is approximately 500m long and 400 m wide at the surface.

Zone 41
- Reaches a maximum depth of ~120m below surface.
- Contains a single 14 m wide ramp system located on the footwall to reach the base of the pit at 205mRl.
- Is approximately 410m long and 225m wide at the surface.

Zone 51
- Reaches a maximum depth of ~125m below surface.
- Contains a single 14m wide ramp system located on the footwall to reach the base of the pit at 210mRl.
- Is approximately 750m long and 200m wide at the surface.
- Has three distinct pods, with the central pod being the deepest. PW
- Reaches a maximum depth of ~100m below surface.
- Contains a single 14m wide ramp system to reach the base of the pit at 120mRl.
- Is approximately 300m long and 200m wide at the surface

WGH
- Contains a main pit stage, with three smaller satellite stages.
The main pit:
- Reaches a maximum depth of ~125m below surface.
- Contains a complex ramp system design to access the base of the pit using internal walls where possible to minimise waste mining on the external walls.
- Is approximately 500m long and 400 m wide at the surface.
The satellite stages:
- A relatively small in size, and average 200m long, 100m wide and 20m deep.
- Require minimal final ramps as the material will be mined off the natural surface contours.

IAM
- Reaches a maximum depth of ~90m below surface.
- Contains a single 14m wide ramp system to reach the base of the pit at 255mRl.
- Is approximately 250m long and 150m wide at the surface.

As the potential size of the underground operations are relatively small in comparison to the open pit, no further analysis or designs were completed for the underground component of the Study.

It has been assumed that, subject to permitting, a combination of conventional open cut and underground mining methods will be utilised at Cape Ray based on orebody geometry and orebody depth from surface. The 04 and 41 deposits could be amenable to open cut mining followed by underground mining using a long-hole stope method.

Comminution

Crushers and Mills

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Processing

  • Gravity separation
  • Centrifugal concentrator
  • Smelting
  • Carbon re-activation kiln
  • Agitated tank (VAT) leaching
  • Concentrate leach
  • Carbon in leach (CIL)
  • AARL elution
  • Solvent Extraction & Electrowinning
  • Cyanide (reagent)

Summary:

The plant is designed to process 1.2 Mt/y RoM ore and incorporates a single processing line of a primary jaw crusher, secondary and tertiary cone crushers and a crushed ore bin to provide 12 hours of surge capacity prior to the milling circuit. The grinding circuit consists of a single stage ball mill, with gravity concentration, followed by a leach-CIL circuit, elution and carbon regeneration, gold smelting, tailings thickening and cyanide destruction facilities. The detoxified tailings stream is stored in the Tailings Management Facility (TMF).

The plant is based on a conventional processing flowsheet using industry standard equipment. Plant operations will be monitored using a control system from a centrally located control room.

Recoveries & Grades:

CommodityParameterAvg. LOM
Gold Recovery Rate, % 96
Gold Head Grade, g/t 2
Silver Recovery Rate, % 56
Silver Head Grade, g/t 6.13

Production

CommodityUnitsAvg. AnnualLOM
Gold koz 88484
Silver koz 124864
All production numbers are expressed as metal in doré.

Operational metrics

Metrics
Annual mining capacity 25 Mt *
Annual ore mining rate 1.2 Mt *
Annual production capacity 100 koz of gold metal in doré *
Annual processing capacity 1.2 Mt *
Stripping / waste ratio 9.6 *
Ore tonnes mined, LOM 7.8 Mt *
Total tonnes mined, LOM 92.7 Mt *
Tonnes processed, LOM 7.83 Mt *
* According to 2020 study.

Production Costs

CommodityUnitsAverageAverage
Credits (by-product) Gold USD 00
Cash costs Gold USD 000
All-in sustaining costs (AISC) Gold USD 000
All-in sustaining costs (AISC) Gold USD 0000000
Assumed price Silver USD 00
Assumed price Gold USD 0000
Operating margin Gold USD 0000000
* According to 2020 study / presentation.
Net of By-Product.

Operating Costs

Currency2020
OP mining costs ($/t mined) CAD 2.8 *  
UG mining costs ($/t mined) CAD 90 *  
Combined mining costs ($/t milled) CAD 40.3 *  
Processing costs ($/t milled) CAD 21.4 *  
G&A ($/t milled) CAD 4.94 *  
Total operating costs ($/t milled) CAD 66.6 *  
* According to 2020 study.

Project Costs

MetricsUnitsLOM Total
Pre-Production capital costs $M CAD 8.7
Sustaining CapEx $M CAD 47.3
Total CapEx $M CAD 145.4
Total Taxes $M CAD 137
Gross revenue (LOM) $M CAD 1,093
EBITDA (LOM) $M CAD 583
Pre-tax Cash Flow (LOM) $M CAD 583
After-tax Cash Flow (LOM) $M CAD 253
Pre-tax NPV @ 5% $M CAD 300
Pre-tax NPV @ 10% $M CAD 231
Pre-tax NPV @ 8% $M CAD 256
After-tax NPV @ 5% $M CAD 196
After-tax NPV @ 10% $M CAD 152
After-tax NPV @ 8% $M CAD 168
Pre-tax IRR, % 61
After-tax IRR, % 51
After-tax payback period, years 1.8

Heavy Mobile Equipment

Fleet data has not been reported.

Personnel

Mine Management

Source Source
Job TitleNameProfileRef. Date
Managing Director and CEO Sam Pazuki LinkedIn Dec 30, 2023

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