Sirios Resources has announced a 22% increase in its resource estimate for the Cheechoo gold property in Eeyou Istchee James Bay in Quebec, Canada.
17 November 2020
Some 5,237m of additional drilling as added 355,000 ounces to the initial resource estimate, bringing the total inferred resource to 93 million tonnes grading 0.65 grams per tonne for 1.96Moz.
“With relatively little drilling and at a low cost, we have significantly increased the size of the mineral resource on the property, demonstrating that the project improves every time work is carried out,” said president and CEO Dominique Doucet.
With the resource update completed, the company will now look to raise C$4-5 million to undertake 15,000m of drilling from January 2021.
“This has the goal of shifting inferred resources into indicated resources. We expect more than 70-75% of resources should be transformed with that programme,” Doucet told Mining Journal. Another key task is negotiating a layback agreement with the owners of the neighbouring property to Cheechoo, which would add even more ounces to the resource, which has the added complexity of requiring talks with three parties.
“The deposit adjoins the property boundary so there is a significant amount of gold mineralisation on our property that cannot be labelled a resource yet as to access it we would need to start digging the pit on the neighbours ground. We are talking with our neighbours. The property is owned by Newmont (37%), Fury Gold (37%) and Azimuth Exploration (26%) and as there is no clear leader we need some patience to solve this situation, but an agreement would add at least 400,000oz on top of the resource we announced today,” said Doucet.
Early in the new year, Sirios also expects to receive the results of column leach metallurgical testing, which will be a key component in the future preliminary economic assessment for Cheechoo, for completion later in 2021.
Cheechoo is an open-pittable deposit less than 15km from Newmont’s underground Eleonore mine which produced 246,000oz in 2019. Newmont is the company’s largest shareholder with a 17% stake, which has reserves of 1.28Moz and resources of 990,000oz as of February 2020.
Despite the proximity of Eleonore, Doucet believes the 15-20km trucking distance may be too far for the low-grade large tonnage Cheechoo, although there will undoubtedly be some synergies the project can benefit from. However, this will be something that work will look to address. “We may find a mining strategy that could sort the high-grade material which could be shipped to the adjoining milling facility,” said Doucet.
Shares in Sirios Resources are trading at C18c, valuing the company at $31 million.