We’ve followed Gowest Gold (V.GWA) for several years and from the get go it was clear Greg Romain was going to build a mine. Right now, at Gowest’s property north of Timmins, Ontario, an underground ramp has been extended 350 meters. “We’re 100 meters from ore,” said Romain. “What we have been seeing is what we expected. Once we hit the ore zone, we will start mining.”
In its update press release dated August 21, 2017, the company was very clear about what its goals are and when it anticipates achieving them. “The development work includes the main ramp decline to the south in anticipation of reaching the first mineralized zone in mid Q3 to begin the 30,000 tonne bulk sample.”
The Gowest mining plan has evolved and will continue to evolve as the bulk sample is processed. “We’ll crush the material on site,” said Romain. “And then we will run the ore through an X-ray sorter. This will upgrade the gold grade of the material before we send it to the mill.”
“A couple of years ago we did a full production run on a one ton sample,” said Romain. “And a couple of weeks ago we did some more testing with positive results in both cases.”
“Sorting changes the economics of the mine. You mill less material. About half as much.” said Romain. “But we have to figure out the best way to handle the deposit with a sorter and that is part of what we are doing with the bulk sample. We want to reconcile what we had in the Pre-Feasibility Study with the bulk sample. Show the market that we can “make the grade.” We need to be very realistic. We don’t want to cover up our sins. Processing up to 30,000 tons of material will demonstrate that.”
For Gowest, the timing to actually begin mining is pretty close to perfect. “We entered into a definitive joint venture agreement with Northern Sun Mining to own 50% of the Redstone mill, which we announced in mid-July,” said Romain. “We’ll operate the mill together. The mill is ready to go. The last ore was put through a year and a half ago. We’ll start putting the ore from our bulk sample through in the fourth quarter of this year.”
“The mill has a total capacity of 1,500 tons per day which includes a 500-ton and a 1,000-ton-per-day circuit,” said Romain. Having the two circuits will allow the mill to meet Gowest’s needs as it ramps up production. “It will take three months to mine and process the bulk sample. So early in 2018 we’ll have completed the bulk sample and be in pre-production for the mine. We hope to be fully permitted to mine and we expect full production in early 2019.”
Gowest has had to build into its plans for the Bradshaw mine the fact that the gold there is “refractory.” Essentially, it is locked up in a sulfide mineral structure which requires an additional processing step. “We have to put it through pressure oxidation or roasting,” explained Romain. “It’s the step which will unlock the value of Bradshaw. They are well-understood processes with an additional cost of around $100 an ounce. But it has never happened in the Timmins camp.”
For the moment, the processed Bradshaw material will have to be sent to one of the operating mining autoclaves. “But the bigger vision,” said Romain, “is to build a central autoclave.” The Bradshaw mine is only one of a number of refractory deposits in the Timmins camp.
Unlike many explorers who are attempting to transition to mining, Gowest has non-dilutive financing in place in the form of a USD 17,600,000 Pre-Paid Forward Gold Purchase Agreement concluded in December 2016. This agreement, with a company controlled by Pandion Mine Finance, LP, allows Gowest to focus on building the Bradshaw mine and process the Bradshaw ore because the “advance” will be paid back in the gold mined from the property.
This leaves Romain able to monitor progress at the mine site. “We’re making 5 or 6 meters a day,” said Romain. “We’re finding very competent rock in the mine. We go to the rock face, put in powder, blow the rock and then scoop it out and put in the rock bolts.”
While there are still meters to go before Gowest is mining its deposit, Romain is very confident that he will soon be running a fully operational mine.
At time of writing Gowest was trading at $0.22 with 314,793,748 shares outstanding for a market cap of $69,254,625.
Feature Gallery – Gowest Gold builds its ramp at the Bradshaw Mine, Timmins Ontario (click for full sized photo)