VANCOUVER, BC / ACCESSWIRE / February 28, 2019 / Skeena Resources Limited (TSX.V: SKE, OTCQX: SKREF) ("Skeena" or the "Company") is pleased to announce an updated Mineral Resource Estimate (MRE), for the Eskay Creek Project ("Eskay Creek"), which has been reviewed and validated by SRK Consulting (Canada) Inc ("SRK"). The updated 2019 MRE has a larger component of pit constrained resources than the 2018 MRE which was principally reported as underground resources. Remaining mineralization below the optimized resource reporting pit shell with reasonable prospects of economic extraction by underground mining methods is reported accordingly. The effective date of this MRE is February 28, 2019 and a new technical report will be filed on the Company's website and SEDAR within 45 days of this disclosure.
Updated 2019 Pit Constrained Resource Estimate
The pit constrained Indicated resource includes 2.46 million gold equivalent ounces within 12.7 million tonnes at an average gold equivalent grade of 6.0 g/t. The pit constrained Inferred resource includes 1.23 million gold equivalent ounces within 13.6 million tonnes at an average gold equivalent grade of 2.8 g/t.
Table 1: Indicated and Inferred pit constrained resources reported at a 0.7 g/t AuEQ cut-off grade.
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| GRADE | CONTAINED OUNCES | ||||
| TONNES | AUEQ | AU | AG | AUEQ | AU | AG |
(000) | G/T | G/T | G/T | OZ (000) | OZ (000) | OZ (000) | |
TOTAL INDICATED | 12,711 | 6.0 | 4.5 | 117 | 2,455 | 1,818 | 47,791 |
TOTAL INFERRED | 13,557 | 2.8 | 2.2 | 42 | 1,230 | 984 | 18,455 |
Updated 2019 Underground Resource Estimate
The underground Indicated resource estimate includes 218,000 gold equivalent ounces within 819,000 tonnes at an average gold equivalent grade of 8.2 g/t. The underground Inferred resource estimate includes 78,000 gold equivalent ounces within 295,000 tonnes at an average gold equivalent grade of 8.2 g/t.
Table 2: Indicated and Inferred underground resources reported at a 5.0 g/t AuEQ cut-off grade.
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| GRADE | CONTAINED OUNCES | ||||
| TONNES | AUEQ | AU | AG | AUEQ | AU | AG |
| (000) | G/T | G/T | G/T | OZ (000) | OZ (000) | OZ (000) |
TOTAL INDICATED | 819 | 8.2 | 6.4 | 139 | 218 | 169 | 3,657 |
TOTAL INFERRED | 295 | 8.2 | 7.1 | 82 | 78 | 68 | 778 |
2019 Resource Estimate - Additional Considerations
To constrain the pit optimization, the Company requested the application of a Mining Cost Adjustment Factor (MCAF) to certain blocks in the resource model to limit the ultimate depth of the resource reporting pit. The applied MCAF resulted in a tightly constrained resource reporting pit shell with a maximum depth of only 230 meters below surface. Due to the resource being advantageously located below a topographic ridge, the average maximum depth below surface of the pit constrained resources is only 180 meters resulting in a modest strip ratio of 7.5:1.
Table 3: Combined pit constrained and underground resources.
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| GRADE | CONTAINED OUNCES | ||||
| TONNES | AUEQ | AU | AG | AUEQ | AU | AG |
| (000) | G/T | G/T | G/T | OZ (000) | OZ (000) | OZ (000) |
INDICATED | |||||||
PIT CONSTRAINED | 12,711 | 6.0 | 4.5 | 117 | 2,455 | 1,818 | 47,791 |
UNDERGROUND | 819 | 8.2 | 6.4 | 139 | 218 | 169 | 3,657 |
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INFERRED | |||||||
PIT CONSTRAINED | 13,557 | 2.8 | 2.2 | 42 | 1,230 | 984 | 18,455 |
UNDERGROUND | 295 | 8.2 | 7.1 | 82 | 78 | 68 | 778 |
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TOTAL INDICATED | 13,530 | 6.1 | 4.6 | 118 | 2,673 | 1,987 | 51,448 |
TOTAL INFERRED | 13,852 | 2.9 | 2.3 | 43 | 1,308 | 1,052 | 19,233 |
The majority of remaining mineralization at Eskay Creek is hosted in the rhyolite facies feeder structures which are not enriched in the exhalative epithermal suite of elements (Hg-As-Sb). Preferential historical development and mining of the bonanza grade mineralization hosted in the
mudstone has resulted in extensive depletion of resources in this rock type. The 2019 pit constrained MRE indicates that on a tonnage weighted basis, 70% of the contained gold equivalent ounces are hosted within the rhyolite facies with only 30% hosted in the remaining unmined mudstone.
The metallurgical process recovery assumptions which were applied to the pit optimizations and to the calculations to determine cut-off grades for reasonable prospects of economic extraction are well founded from historical Eskay Creek mill recoveries. Averaged across all rock types, gold recovery was 80% and silver recovery was 92%. It is noteworthy that liberation of free milling gold is excellent as demonstrated by the historical gravity gold recoveries which ranged from 10-30%.
The 2019 MRE was derived from 7,583 historical surface and underground diamond drill holes totalling 651,332 meters, with an additional 46 surface diamond drill holes completed by Skeena in 2018 totalling 7,738 meters.
Eskay Creek Deposit Mineral Resource Estimate Notes:
The mineral resources disclosed in this press release were estimated using the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") standards on mineral resources and reserves definitions, and guidelines prepared by the CIM standing committee on reserve definitions and adopted by the CIM council
Table 4: Pit constrained scenario assumptions for determining cut-off grades with reasonable prospects of economic extraction.
INPUT PARAMETERS | VALUE | UNIT |
PIT WALL ANGLES | 45 | DEGREES |
REFERENCE MINING COST | $ 2.00 | US DOLLARS PER TONNE MINED |
MINING RECOVERY | 95 | PERCENT |
MINING DILUTION | 5 | PERCENT |
PROCESSING COST | $ 15.00 | US DOLLARS PER TONNE PROCESSED |
GENERAL AND ADMINISTRATION | $ 5.75 | US DOLLARS PER TONNE PROCESSED |
PROCESS RECOVERY AU | 80% | PERCENT |
PROCESS RECOVERY AG | 90% | PERCENT |
SELL PRICE AU | $ 1,275.00 X (0.95) | US DOLLARS PER OUNCE (95% PAYABLE) |
SELL PRICE AG | $ 17.00 X (0.95) | US DOLLARS PER OUNCE (95% PAYABLE) |
TRANSPORTATION/REFINING COSTS | $ 25.00 | US DOLLARS PER OUNCE AUEQ |
COMBINED STRIP RATIO | 7.5:1 | UNITLESS |
Table 5: Underground scenario assumptions for determining cut-off grades with reasonable prospects of economic extraction.
INPUT PARAMETERS | VALUE | UNIT |
REFERENCE MINING COST | $ 79.25 | US DOLLARS PER TONNE MINED |
PROCESSING COST | $ 15.00 | US DOLLARS PER TONNE MILLED |
GENERAL AND ADMINISTRATION | $ 5.75 | US DOLLARS PER TONNE MILLED |
PROCESS RECOVERY AU | 80% | PERCENT |
PROCESS RECOVERY AG | 90% | PERCENT |
SELL PRICE AU | $ 1,275.00 X (0.95) | US DOLLARS PER OUNCE (95% PAYABLE) |
SELL PRICE AG | $ 17.00 X (0.95) | US DOLLARS PER OUNCE (95% PAYABLE) |
TRANSPORTATION/REFINING COSTS | $ 25.00 | US DOLLARS PER OUNCE AUEQ |
Eskay Creek Mineralization
The Eskay Creek deposits represent a shallow water, bimodal volcanic sequence hosted in a fault bounded basin with an epithermal VMS signature. Rhyolite facies volcanics are overlain by mafic volcanics with a clastic mudstone occurring at the contact between the two volcanic episodes. This mudstone represents the period of quiescence between the two volcanic events and is spatially and temporally related to the main mineralizing event at Eskay Creek. The epithermal suite of elements (Hg-Sb-As) and bonanza precious metal grades dominantly occur at this interface but are not homogenously distributed throughout the mudstone. Rather, they are spatially associated with vents fed from underlying synvolcanic feeders.
Due to the higher precious metal tenor of the mudstone-hosted mineralization, the vast majority of historical production at Eskay Creek occurred within this rock type whilst the rhyolite-hosted feeder style mineralization was less developed due to its lower Au-Ag grades. Rhyolite-hosted mineralization is not enriched in Hg-Sb-As and was often blended with mudstone-hosted zones to reduce smelter penalties for the on-site milled concentrates and Direct Shipped Ore (DSO).
Qualified Persons
The Independent and Qualified Person for the Eskay Creek MRE is Sheila Ulansky P.Geo., of SRK Consulting (Canada) Inc. (Vancouver), who has reviewed, validated and approved the Eskay Creek MRE as well as the technical disclosure in this release. In accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects, Paul Geddes, P.Geo. Vice President Exploration and Resource Development, is the Qualified Person for the Company and has validated and approved the technical and scientific content of this news release. The Company strictly adheres to CIM Best Practices Guidelines in conducting, documenting, and reporting its activities on its various exploration projects.
About Skeena
Skeena Resources Limited is a junior Canadian mining exploration company focused on developing prospective precious and base metal properties in the Golden Triangle of northwest British Columbia, Canada. The Company's primary activities are the exploration and development of the past-producing Snip mine and the optioned Eskay Creek mine. In addition, the Company has completed a Preliminary Economic Assessment on the GJ copper-gold porphyry project.
On behalf of the Board of Directors of Skeena Resources Limited,
Walter Coles Jr.
President & CEO
Cautionary note regarding forward-looking statements
Certain statements made, and information contained herein may constitute "forward looking information" and "forward looking statements" within the meaning of applicable Canadian and United States securities legislation. These statements and information are based on facts currently available to the Company and there is no assurance that actual results will meet management's expectations. Forward-looking statements and information may be identified by such terms as "anticipates", "believes", "targets", "estimates", "plans", "expects", "may", "will", "could" or "would". Forward-looking statements and information contained herein are based on certain factors and assumptions regarding, among other things, the estimation of mineral resources and reserves, the realization of resource and reserve estimates, metal prices, taxation, the estimation, timing and amount of future exploration and development, capital and operating costs, the availability of financing, the receipt of regulatory approvals, environmental risks, title disputes and other matters. While the Company considers its assumptions to be reasonable as of the date hereof, forward-looking statements and information are not guarantees of future performance and readers should not place undue importance on such statements as actual events and results may differ materially from those described herein. The Company does not undertake to update any forward-looking statements or information except as may be required by applicable securities laws.
Neither TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.
SOURCE: Skeena Resources Limited