Name of the Project
Eau Claire gold project.

Location
The project is located in James Bay, Quebec, Canada.

Client
Eastmain Resources.

Project Description
A preliminary economic assessment (PEA) has shown the robust economics for a combined openpit and underground mining operation, with a mine life of 12 years.

The project has total mineral resources of 4.29-million tonnes grading 6.18 g/t gold.

The PEA schedule assumes a combined openpit and underground operations of 6.4-million of mineralised material at a blended grade of 4.87 g/t gold for one-million contained ounces of gold over 12 years.

Proposed mining will start with openpit mining followed by underground mining.

The PEA proposes a conventional truck-and-shovel openpit operation, followed by ramp access and captive long-hole open stoping in the underground portion of the mine. 

The mine plan is to extract the upper portions of the mineral resources (top 100 m) using openpit mining methods. While the openpit is producing, an underground portal will be established outside of the pit and an underground ramp will be extended below the proposed crown pillar.

The PEA envisages mining of 1.64-million tonnes of mineralised material at 3.78 g/t gold for 199 000 oz of gold over three years from the two openpits. The openpit operations com-prise production from the Main Pit (650 m × 275 m × 100 m depth) and the smaller West Pit (260 m × 120 m × 40 m depth), to be mined at a bench height of 5 m. The openpits have an average strip ratio of 9.4:1.

Underground mining will progress by captive long-hole methods in a top-down fashion, with major sublevels every 24 m. The underground operation proposes mining of 4.76-million tonnes of mineralised material grading 5.24 g/t
gold for 801 500 oz over 11 years. The average planned dilution factor has been conservatively applied at 40% at zero dilution grade.

Gold mineralisation will be processed in a 1 500 t/d process plant, using conventional crushing, grinding, cyanidation and carbon-in-pulp processes. The conventional cyanidation circuit includes a gravity concentration within the grinding circuit followed by direct cyanidation of gravity tails. The PEA recovery factor relies on metallurgical testwork conducted by SGS Lakefield Research, which indicates that gold recovery of 95% is attainable with gravity and cyanidation processes. A bond ball mill index of 11 kWh/t indicates material will not require high energy to be processed.

Tailings will be dewatered in the process plant and transported by truck to a geomembrane-lined tailings management facility (TMF), reducing the risk for potential surface and groundwater contamination. The TMF design will incorporate engineered features to manage the chemical and physical stability of the deposited tailings in accordance with current best-in-class practices. This mitigation strategy is similar to those at other operations in the region.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value (NPV), at a 5% discount rate, of $381-million and an internal rate of return (IRR) of 32%. After-tax, the NPV is estimated at $260-million at a 5% discount rate and the IRR at 27%, with a payback of 3.1 years.

Value
The project has a preproduction capital cost, including contingency, of $174.7-million.

Duration
Not stated.

Latest Developments
The PEA has recommended the initiation of basic and detailed engineering for openpit and underground ramp design to improve mining options to minimise capital requirements and to control and minimise dilution. 

Additional information regarding engineering and mining of the Eau Claire deposit to inform advanced technical studies will also be gathered. 

A detailed geotechnical study is recommended as part of this exercise. 

The PEA also proposes the development of options to improve advanced technical study outcomes by conducting advanced underground exploration and bulk sampling.

Baseline studies in support of an environ-mental-impact assessment of the project will also be initiated, with consideration for advanced exploration and full mine development options.

Key Contracts and Suppliers
P&E Mining Consultants (PEA) and SGS Lakefield Research (metallurgical testwork).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Eastmain Resources investor relations consultant Laurenn Russell, tel +1 647 347 3735 or email Lrussell@eastmain.com.