The Vancouver-headquartered company now plans to bring forward mining of higher-grade oxide material in the current resource in parallel with reprocessing about 10 million tonnes grading 1.5 grams per tonne gold left on the leach pad by former operator Viceroy Minerals Corporation.
"As phase one restart work has progressed, it has become evident that phase one and two should proceed together to take advantage of emerging synergies and higher gold prices to generate enhanced cash flow," said CEO Janet Lee-Sheriff. "Since most of the project's capex is required for start-up in phase one, combining the added potential of higher-grade new material should produce significantly more ounces and a better economic return."
Both reprocessing and newly mined material will use the same crushing circuit, heap leach pad, ADR plant, power supply equipment, assay lab, machine shop, warehouse, office and camp facilities.
Phase two work will begin with feasibility-level mine planning, incorporating new data from the upcoming resource estimate update which Kappes Cassiday & Associates expects to be completed in the next 30 days.
The results of these studies will integrate phase one and phase two mining from licensed areas into a single feasibility study, expected to be complete by year end.
Brewery Creek hosts about 765,000oz at 1.13g/t in indicated oxide material and a further 440,000oz grading 0.97g/t inferred. It also has 270,000oz at 0.99g/t held in inferred sulphide material.
Shares in the company (TSXV:GPY) traded 13% lower at C37.5c on Tuesday, mainly owing to a perception the combined feasibility study pushes the mine restart date further out into the future. The company has a market value of $63 million (US$46 million).