Young – Davidson
Maximizing Project Economics with a New Resource Estimate and Engineering Review
Since acquiring the Young-Davidson property in late 2005, Northgate has successfully executed an aggressive exploration program, more than doubling the gold resource estimate and moving most of these resources to measured and indicated status. Equipped with total measured and indicated resources of over 3.3 million ounces, the mine design is now being optimized in order to accommodate the larger resource base and to take advantage of the continuity and thickness of the main zones, while using some of the existing infrastructure and equipment from the Kemess camp.
The Young-Davidson property is located in the gold-rich Abitibi greenstone belt of northern Ontario, 60 km west of Kirkland Lake. The property is on the site of two past producing mines, both with track records of successful mining and simple metallurgy. In 2008, the underground ramp development was completed after advancing a total of 3,039 metres (m) to a total vertical depth of 483 m. Rehabilitation of the existing No. 3 Shaft was completed and the water level is being maintained below the 13th level.
Targeting start-up of production in 2012, Young-Davidson is expected to produce an average of 175,000 ounces of gold for 14 years, at a net cash cost of $450 per ounce.
In 2009, Northgate will continue to explore to the west of the Young-Davidson pit where syenite host rock is known to exist and will also drill test geophysical anomalies that have similar characteristics to those at the Young-Davidson deposit. The successful diamond drill campaign in 2008 brought total measured and indicated resources on the property to 3.3 million ounces of gold, including 3.0 million ounces underground consisting of 26 million tonnes at an average grade of 3.62 g/t. In addition, the indicated open pit resource estimate contains 270,000 ounces of gold consisting of five million tonnes at an average grade of 1.70 g/t. Drilling will continue in 2009, focusing on other targets outside the known resource area.
The significant increase in resources that was announced at the end of 2008 requires a reevaluation of the mine design proposed in the Preliminary Economic Assessment. A pre-feasibility study is currently underway with the goal of reducing operating costs by applying low-cost bulk mining methods to the dramatically larger resource base and utilizing existing mine infrastructure, including the shaft for ventilation and secondary mine egresses. Northgate expects to complete the pre-feasibility study by the end of the second quarter, followed by the feasibility study at the end of the year.
Northgate's commitment to health and safety was clearly demonstrated at Young-Davidson, as there were no lost-time injuries recorded in 2008, the second year in a row that the project has achieved such a feat. This success will be the benchmark for all exploration, construction and operation activities going forward.
175,000
ounces of gold projected in 2009
14 years
target mine life