There are huge advantages to a brownfield project. Past producing mines come with a valuable legacy of geological and engineering data that is backed by production numbers and, sometimes, leftover mineralization. On the Chimo Mine project this is the case since the mine was closed due to weak gold prices and not lack of mineralization. Factor that in with underground infrastructure that can be readily rehabilitated and it becomes a manageable challenge to prove up the “blue sky”. That’s what Cartier Resources (V.ECR) has been up to in the last two years.
Cartier’s most recent press release confirms that there is, indeed, mineralization at depth in the newly discovered structures. Cartier’s CEO commented, “These new results, highlight the importance of prioritizing continued exploration of Zones 5M4 and 5NE in order to maximize the potential of drill results previously reported in the main Zones 5B and 5M.” (See Figure)
“The release was all about the success of a pilot hole and it’s branches” explained Cloutier. “We were trying to widen the zone by using directional drilling. Same hole, multiple intersections and they are all drilled from the same collar. These results demonstrate that our new discovery continues at depth and it gives the new zone some width.” Adding, “there is all the reason to expect that this zone will extend at depth as the main mine plunge did in Phase I drilling.”
“This is the same gold structure as the mine,” said Cloutier. “Same metallurgy, same rock mechanics. And the new structure extends at depth, gets wider and is showing better grades.”
You have to look carefully at the figures to understand just how significant these results may prove to be. If a company was planning to re-open the Chimo mine it would want to know that there was enough mineralized material within a reasonable distance from the current shaft to make the mine profitable. While the new results are at 1000 meters depth, the mineralized intervals are only a few hundred meters from existing infrastructure.
“Our peers understand this,” said Cloutier. “Local producers get it.”
“Our Phase One drilling was proof of concept,” said Cloutier. “We wanted to confirm that the mine trend continues at depth, which we did. And we wanted to confirm that there were lateral extensions, which we also did. Phase Two was looking for additional mineralized structures relatively close to the shaft. We thought they were there and we found them.”
“Phase Three, where we are now, is looking to confirm that the new mineralized structures continue on down to shaft depth and more!” said Cloutier. The other thing the new results indicate is that the new discovery has a “tilt” and that tilt is towards the old shaft and workings. Essentially, as Cartier had drilled deeper its intersections have been getting closer and closer to the existing infrastructure. Naturally, Cloutier hopes that further drilling will bring the new discovery even closer to the existing infrastructure.
Cloutier, CEO of Cartier Resources, knows all this which is why Cartier bought the Chimo Mine located 45 km east of Val-d’Or, Quebec. “We know the metallurgy and the rock mechanics because they are identical to the old Chimo mine,” said Cartier. “The anticipated CAPEX is very low because there is already a shaft. There is a skilled workforce nearby and mills to process the Chimo rock are just down the road.”
The key question any potential acquirer or joint venture partner needs to answer is how many economic ounces are there on the Chimo project. It is a question which involves both a resource estimate and the ability to accurately map where the resources are relative to the existing shaft and drifts.
Cartier has been fortunate to have had significant support from its investors which include Agnico Eagle. “In a prolonged bear market, we continued to drill. Now is the time for modelling of all the new data generated and comparing its behaviour to previous mining,” said Cloutier.
“We are in the process of completing the wireframes for all the mineralized zones on the project as well as the wireframes for what was previously mined, the results will help the Resource Estimate,” said Cloutier.
In many ways, however, the traditional 43-101 resource estimate is not likely to actually capture the value of the combination ounces in the ground and their proximity to a well developed, albeit flooded, mine. A decent sized resource from 500 to 1200 meters below the surface may not be economic if a company has to sink a shaft that deep to mine it. However, those same ounces adjacent to an easily dewatered mine shaft and tunnels could become very economic indeed.
Chimo’s potential to become the next mine is becoming better known in the local producing community. “finding new ounces is always a challenge but when one does, finding the organization with a strategic interest and ability to pay, generally follows,” said Cloutier.