Nov 28 2015
West Kirkland Mining Inc. ("West Kirkland") announces receipt of a Decision Record (DR) and Finding of No Significant Impact (FONSI) for the Environmental Assessment (EA) of the Three Hills Mine Project located approximately one mile west of Tonopah in Esmeralda County, Nevada. The DR signifies completion of the National Environmental Policy Act (NEPA) and EA process, and is the final major permitting step for construction to begin.
"We are very happy to have completed both a pre-feasibility study and permitting at the Three Hills Mine since acquiring the property in April, 2014. Construction permits significantly add to the value of any property – this is a big step forward for West Kirkland. We appreciate the professionalism and hard work of the BLM staff, the staff at all involved state agencies, and our consultants for making this happen so quickly. We will now consult with our major shareholders on the next steps for the project," said R. Michael Jones, President and CEO of West Kirkland Mining.
About the NEPA and EA Process
The EA for the Three Hills Mine is required under the National Environmental Policy Act (NEPA). The acts sets up the procedural requirements for all federal governmental agencies to prepare environmental assessments in response to proposed major activities on federal lands. Part of Three Hills Mine is on federal lands administered by the BLM, therefore NEPA requires the BLM to prepare an EA to analyze potential environmental consequences of the planned project and any reasonable alternatives. West Kirkland has advanced through baseline studies, the draft EA, the final EA, and has now completed the process with the issuance of a Decision Record. Various state permits are also required and have either been obtained or are in the final stages of being processed by state agencies.
Technical Report Filed
The EA is based on the technical report that West Kirkland filed on SEDAR on July 17th, 2015, entitled "Technical Report and Preliminary Feasibility Study: Hasbrouck and Three Hills Gold-Silver Project, Esmeralda County, Nevada," effective June 19, 2015 and prepared in conformance with NI 43-101 by Thomas L. Dyer, P.E. and Paul Tietz, C.P.G. of Mine Development Associates (MDA), who are West Kirkland's Independent Qualified Persons as defined under NI 43-101.
The project's base case has an after-tax internal rate of return (IRR) of 26% and $75 million net present value at 5% discount rate (NPV 5%) using $1,225/oz gold and $17.50/oz silver (all reported values are in US dollars and based on 100% of the project). Initial capital to construct the Three Hills Mine is estimated at $54.3 million, with an additional $34.8 million required in Year 1 of the project to commence construction of the Hasbrouck Mine. Processing is planned at an average 6.1 million ore tons per year for 71,000 ounces annual gold production for eight years.
An alternative to the base case is to delay construction of the Hasbrouck Mine for four months which would allow cash flow from the Three Hills Mine to fully fund the construction of the Hasbrouck Mine while only slightly reducing after-tax IRR from 26% to 24% and NPV from $75 million to $71 million.
About the Hasbrouck Gold Project
Located near Tonopah, Nevada, the Hasbrouck Gold Project consists of two oxidized gold deposits eight kilometers apart, Three Hills and Hasbrouck. West Kirkland has a 75% controlling interest in the project. In 2015, Waterton Precious Metals Fund II Cayman, LP bought a 25% interest in the Hasbrouck Gold Project and certain exploration assets from Allied Nevada Gold Corp for US $17.5 million.
Sandy McVey, P.Eng., Chief Operating Officer for West Kirkland, and a non-independent Qualified Person as defined by NI 43-101, has reviewed the information contained in this news release and has verified the data.
Source: http://www.wkmining.com/