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Pretivm Resources Releases Cost Estimate, Project Update for Brucejack Underground Gold Mine, B.C.

Published: February 18, 2016 |

[Click image to enlarge]

Pretivm Resources Inc. has reported an updated cost estimate and project update for the Brucejack Project scheduled for commercial production in 2017 as a high-grade underground gold mine.

Based on the achievement of the 60 percent engineering milestone, a capital cost estimate was carried out in late 2015 to update the June 2014 feasibility study cost estimate for the Brucejack Project. The estimated total project capital cost to complete design, construction, installation and commissioning, including contingencies, is US$640.8 million.

Working capital for the three-month period of post-plant commissioning and initial gold production is estimated at US$56.0 million and covers the cost of operations, but does not take into account any revenue generated during this period. The working capital estimate also covers the costs for prepayments related to electrical power and permitting, including US$9 million in government fees and bonds.

Capital expenditures to the end of Q3 2015 for the development of the Brucejack Project have totaled US$66 million. With the US$540 million construction financing package in September 2015 and cash on hand, the remaining capital required to fully fund the US$696.8 million development of the Brucejack mine is estimated at US$100 million.

Key areas of cost variance between the updated estimate and the feasibility study estimate of US$746.9 million include the following:

• Cost Savings
    • Underground development is projected to cost US$17.7 million less than estimated in the feasibility study estimate. Underground mining equipment of US$23.4 million has been deferred to sustaining capital due to the use of third party mining contractor’s equipment

    • Mill building design-build contract is US$9.5 million less than estimated in the feasibility study estimate

    • In addition to the estimated construction savings, the lower assumed Canadian dollar exchange rate in the updated estimate versus the feasibility study estimate resulted in a favorable foreign exchange difference of approximately US$145 million.

• Cost Increases
    • Owner’s cost (excluding working capital) increased by US$46.7 million, primarily as a result of: additional environmental monitoring costs of US$18.6 million, additional winter construction costs of US$14.5 million due to receipt of permits in September, and additional camp support costs of US$10.8 million to cover an increase in overall man-hours during construction.

    • EPCM contractor increased its costs by US$18.4 million.

Construction at the mine remains on schedule for expected commissioning in Q3 2017. The permanent camp pad has been completed, with the first concrete poured on January 19. Assembly of the 330-person permanent camp at site is expected to begin in March. Bulk earthworks to level the site for the mill building are expected to be completed in March with concrete foundation work scheduled to begin in April. The construction of the transmission line is also expected to commence in April. The pre-production underground development contract was awarded to Cementation Canada Inc., and their crews have been mobilized to site and operating on multiple headings since early January.

There are currently more than 700 employees and contractors working on the Brucejack Project.


About Pretivm
Pretivm is constructing a high-grade underground gold mine at its Brucejack Project in northern British Columbia with commercial production targeted for 2017.

To stop by Pretium’s website, CLICK HERE


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