A Dryden-area gold mine developer is out to raise more than $8 million to finance its open-pit and underground operation in northwestern Ontario.
Treasury Metals announced April 20 that it has filed a preliminary short form prospectus to raise up to $8.06 million for its Goliath Gold project, 20 kilometres east of Dryden.
The offering will consist of a maximum of 12,400,000 Units at a price of $0.65 per unit. Each unit will consist of one common share.
The offering closes May 11.
The Toronto-headquartered company plans on the initial development of an open pit to feed ore to a 2,500 per day processing plant before mining heads underground in the mine’s later years.
The company is currently in the mine permit process on the Goliath Project.
Commercial production is slated to begin in the fourth quarter of 2020.
Treasury Metals recently released an updated preliminary economic assessment (PEA) on the Goliath Project, projecting a 37 per cent increase in the life of the mine.
The average annual production is pegged at 87,850 ounces of gold over a 13-year period of combined open pit and underground mine life.
The peak production period will exceed 100,000 ounces per year between Years 3 and 6.
The life-of-mine head grade of 3.81 grams per tonnes is a 33 per cent increase from the company’s 2012 estimates.
Total gold production is estimated at 1.14 million ounces of gold and 2.1 million ounces of silver.
The initial capital to fund construction is estimated at $133.2 million with an additional $132.5 million in sustaining capital over the life of mine, primarily to fund the underground expansion.
The mining plan envisions the open pit generating revenue to fund the underground development.
Underground production begins in the second year with the open pit operating over an additional seven years at a reduced output to supplement underground production to a total of 2,500 tonnes per day over the course of 13 years.