With six drill rigs at work, it's a busy summer at Livengood
FAIRBANKS — International Tower Hills Mines is continuing development planning on the company’s Livengood gold project on the Elliott Highway north of Fairbanks.
Engineering and other work continues on a development plan for the mine that is now due in mid-2013. Normally, a mining company does a “pre-feasibility” study to initiate permitting, followed by a “feasibility” study following the obtaining of permits. But at its Livengood project, ITH is combining the two into one feasibility study.
“This study will provide our first good look at the project we would like to take to permitting,” said Karl Hanneman, the company’s general manager for Alaska.
No figures are available yet on the required capital investment, but Hanneman said it will be, “substantial.”
To gather information necessary to support permit applications, ITH is doing baseline environmental monitoring and is now in its fourth year of that, said Rick Solie, ITH Community and Government Relations manager.
Six drill rigs and about 85 people are working at the Livengood project site this summer on additional drilling, Solie said.
Hanneman said ITH also selected 11 tons of ore samples from core last January and shipped it out for metallurgical tests, the results which will help the company design an optimal process for milling the ore to extract gold.
The Livengood project is on about 50,000 acres of mining claims but the known deposit covers just a few hundred acres, Hanneman said.
If it is developed, Livengood would be a large surface mine with a mill to extract gold from the mined rock. It would be similar to the Fort Knox mine that is now in production near Fairbanks, although probably larger.
In a June 21 press release, ITH board chairman Don Ewigleben said the company has postponed its district-wide exploration drilling program to focus on the development plan. However, 18 condemnation and exploration holes and additional geotechnical holes are still being completed in the “Gertrude Basin” area of the mine.
The primary purpose of the condemnation program is to define site facility locations, but it also has the potential to outline additional resources immediately east of the currently proposed mining operation.
“While exploration programs have been deferred this year so we can focus on the more important goal of completing a feasibility study that would greatly de-risk the Livengood project technically, there still exists tremendous exploration potential in the Livengood district,” Ewigleben said in the company’s statement.
On Aug. 12, ITH announced drill results for 45 geotechnical and condemnation drill holes at the Livengood project, and assay results from four of the holes showed intersections with multiple grams of gold content. The location of the intercepts do not affect the current conceptual plan for the locations of mining-related infrastructure contemplated in the ongoing feasibility work, but they do show the potential for new discoveries in the area.
Another target is potential resources below the known ore body.
“Exploration holes in the Money Knob deposit were generally terminated at 200 meters to 300 meters below the surface due to limitations of the drilling technology used,” Ewigleben said in the June 21 press release. “To date, almost all the drill holes in the Money Knob have bottomed out in the gold deposit and six holes extending below the proposed pit bottom at the 300 meter depth penetrated intervals with similar gold grades to the main deposit.”
Additional resources in this area, below the proposed pit bottom, may be identified by drilling done as the mining operation proceeds,” the release said.
Irwin to lead project
In an important personnel announcement, ITH named former state Natural Resources Commissioner Tom Irwin as Alaska vice president and president of Tower Hill Mines Inc., the U.S. operating subsidiary.
Separately, Hanneman was named as the company’s Alaska General Manager, taking over the position previously held by Irwin. The appointments were announced Aug. 16.
Irwin has 35 years of experience in natural resources in Alaska, Nevada and Colorado, and played a major role in the development of the Fort Knox mine near Fairbanks for Kinross Gold Corp. He also served as state resources commissioner for six years.
Hanneman has 30 years of experience in Alaska mining and was regional manager for Teck Alaska during the development of the Pogo gold mine, then operated by Teck, and in the resolution of permit issues on the expansion of the Red Dog lead/zinc mine in northwest Alaska, which is operated by Teck.
In one other development, ITH announced Aug. 3 that it closed a $29.6 million private equity placement to finance its continued exploration and development work.
Significantly, the purchasers in the offering include existing institutional investors who are now shareholders but also AngloGold Ashanti (USA) Exploration Inc., an existing shareholder that is also an operator of major mines. “We’re very pleased that our investors are showing continued confidence in the project,” by participating in new rounds of investment, Solie said.