Name and Location
Coffee gold project, Yukon Territory, Canada.

Client
Kaminak Gold Corporation.

Project Description
A feasibility study completed on the Coffee project has indicated that the project represents a robust, rapid payback, high-margin, ten-year openpit mining and heap-leach project that is profitable in the current gold price environment.

The feasibility study proposes four openpits – Supremo, Late, Double Double and Kona – mined by conventional shovel-and-truck methods at a nominal ore mining rate of five-million tonnes a year for about ten years, with Year 1 being the first full year of commercial gold production. A total of 312-million tonnes of material will be mined to produce 46.4-million tonnes of ore. Run-of-mine ore will be crushed to a 2" feed size and placed on a heap-leach pad. Gold will be extracted from the leachate by an adsorption-desorption-recovery (ADR) carbon plant.

Openpit mining operations will use a fleet comprising industry-standard 16 m³ shovels, 12 m³ front-end loaders, 4 m3 excavators and 144 t haul trucks. This fleet will be supplemented by appropriately sized drills, graders and dozers. A 5 m bench height has been selected for mining in ore and waste, with overall 20 m effective bench heights based on a quadruple-bench configuration. The handling of the fine ore from the crusher to the heap-leach pad is included in the openpit scheduling and operating-cost estimation. Waste rock will be placed in three engineered waste-rock facilities close to the pits from which the waste is sourced. Some waste rock will be backfilled into mined-out pits at Latte, Supremo and Double

Double to create causeways and facilitate ore haulage routes to the crusher. Waste rock from the Kona pit, owing to its geochemical characteristics, will be placed in a temporary waste rock facility adjacent to the pit during mining and then backfilled into the mined-out Kona pit.

The site will be accessed principally from Dawson City, Yukon, through a 214 km single-lane, gravel road with pullouts. Electrical power will be generated on site by diesel-powered generators.

The process includes a two-stage crushing plant feeding a heap-leach operation. Gold will be extracted by an ADR carbon plant. The process is based on a heap-leach processing rate of five-million dry tonnes a year at an average feed grade of 1.45 g/t and an expected overall recovery of 86.3%. The crushing rate will be an estimated 18 200 t/d over the nine-month operating period. The process plant, in proximity and at a lower elevation to the heap-leach facility, minimises pumping by allowing for the gravity feed of pregnant solution.

Crushed ore will be trucked to the heap-leach facility and spread by dozer. Crushing and heap-leach stacking will be suspended from January and March to maintain the thermal integrity of the heap. The facility will operate all year, with the solution heated when necessary to maintain thermal integrity. The facility will be stacked progressively, in well-defined stages, from the east to the west.

Ore leaching will start in the third quarter of Year 1. At the end of the fourth quarter, about 3.5-million tonnes of ore will be available for leaching.
Gold recovery will continue in the first quarter of Year 1, and ore crushing and stacking will restart in the second quarter of Year 1. Progressive closure of the heap-leach pad will start in Year 4 as depleted areas of the facility become available for decommissioning, covering and reclamation.

Net Present Value/Internal Rate of Return
The project has a pretax net present value (NPV), at a 5% discount rate, of $762-million and an internal rate of return (IRR) of 50%, and an after-tax NPV, at a 5% discount rate, of $455-million and an IRR of 37%.

Value
The cost of upgrading existing roads and building an estimated 37 km of new road along the proposed 214 km route is estimated at $25-million.

Duration
Construction is expected to start in 2018, with first commercial production of gold expected in 18 months, excluding access road construction, which will take about nine months.

Latest Developments
With the feasibility study completed, Kaminak will begin advancing the project through the permitting process in Yukon. The project will be subject to an environmental- and socioeconomic-assessment under the Yukon Environ-mental and Socioeconomic Assessment Act, administered by the Yukon Environmental and Socioeconomic Assessment Board (YESAB). Kaminak has assembled a team of experts to assist the company in developing a project proposal, which it plans to submit to the YESAB in the third quarter of 2016. Once the project passes the YESAB’s adequacy review, the Kaminak will submit applications for a Quartz mining licence and water licence, the two major licences required for the construction and operation of a mine.

Key Contracts and Suppliers
JDS Energy & Mining (project management, mining, reserve estimation, process engineering, infrastructure and financial modelling); Sim Geological (geological modelling and resource estimation); Kappes, Cassiday & Associates (metallurgical testwork); ALS Canada (crushing and abrasion testwork); SRK Consulting US (geomechanical and geotechnical); RRD International Corp and The Mines Group (heap-leach facility); Lorax Environmental Services (water balance, geochemistry and source terms); SRK Consulting Canada (water management); JDS Energy & Mining Inc and Onsite Engineering (access road); and Tetra Tech (permafrost).

On Budget and on Time?
Not stated.

Contact Details for Project Information
JDS Energy & Mining, email info@jdsmining.ca.
Sim Geological Inc technical communicator Lori Bentz-Sim, tel +1 778 928 6339 or email lbentzsim@simgeological.com.
Kappes, Cassiday & Associates, tel +1 775 972 7575 or fax +1 775 972 4567.
SRK Consulting US, tel +1 775 828 6800, fax +1 775 828 6820 or email reno@srk.com.
The Mines Group, tel +1 775 322 7622 or fax +1 775 322 2660.
Lorax Environmental Services, tel +1 604 688 7173, fax +1 604 688 7175 or email info@lorax.ca.
SRK Consulting Canada, tel +1 604 681 4196, fax +1 604 687 5532 or email vancouver@srk.com.
Onsite Engineering, tel +250 832 3366 or fax +1 866 235 6943.
Tetra Tech, tel +1 626 351 4664, fax +1 626 351 5291 or email info@tetratech.com.