The Company owns the producing Macassa mine and mill in the Kirkland Lake mining camp as well as the Holt mining complex near Matheson, Ontario (approximately 60 km northeast of Kirkland Lake). The Holt mill, which is currently on care and maintenance, has a capacity of 3,000 tpd and a fully permitted tailings storage facility. The Company plans to evaluate the potential to integrate a number of satellite deposits with the existing infrastructure in the region. The significant 100%-owned opportunities in the Kirkland Lake camp include:
• AK deposit
• Upper Beaver deposit
• Other regional deposits – Upper Canada, Anoki-McBean and Bidgood
• Opportunities along the Main Break where the Company now controls six past producing mines
The AK deposit is located very close to the Macassa property boundary and lies within a few hundred metres of the existing Macassa underground workings. At year-end 2021, the AK deposit was estimated to contain 265,000 ounces of indicated mineral resources (1.3 million tonnes grading 6.51 g/t gold) and 406,000 ounces of inferred mineral resources (2.4 million tonnes grading 5.32 g/t gold). Because of the proximity to the property boundary, the deformation zone hosting the AK deposit, which extends laterally and at depth, it has not been drill tested extensively. This zone, along with the eastern trend of the Amalgamated Break, remain interesting targets for new discoveries.
The Upper Beaver deposit is located approximately 27 km from the Macassa mine and 60 km from the Holt mining complex. As of December 31, 2021, Upper Beaver had approximately 1.4 million ounces of gold and 20,000 tonnes of copper in underground probable mineral reserves (8.0 million tonnes grading 5.43 g/t gold and 0.25% copper); 403,000 ounces of gold and 5,100 tonnes of copper in underground indicated mineral resources (3.6 million tonnes grading 3.45 g/t and 0.14% copper); and 1.4 million ounces of gold and 17,300 tonnes of copper in underground inferred mineral resources (8.7 million tonnes grading 5.07 g/t and 0.20% copper).
The Upper Canada deposit lies approximately 6 km southwest of the Upper Beaver property, and 1.6 km north of the main Larder Lake-Cadillac Deformation Zone, within a 300- to 400-metre-wide strongly altered deformation corridor. Upper Canada hosts indicated mineral resources of 10.4 million tonnes grading 2.15 g/t gold (containing 722,000 ounces of gold) and inferred mineral resources of 18.6 million tonnes grading 3.11 g/t gold (containing 1.9 million ounces of gold) at underground and open pit depths as of December 31, 2021.
The combined indicated mineral resources at the Anoki and McBean deposits have been estimated at 1.9 million tonnes grading 5.33 g/t gold (containing 320,000 ounces of gold) as of December 31, 2021, and there are additional inferred mineral resources, all at underground depths.
Geology
The properties lie within the southern Abitibi Greenstone Belt of the Superior Province of the Canadian Shield, approximately 110 km west of Agnico Eagle's LaRonde mine. The area is underlain by an east-west-trending linear Timiskaming assemblage comprised of volcanic and sedimentary rocks as well as synvolcanic intrusion emplacements consisting typically of diorite, syenite, quartz-feldspar porphyries and monzonite. The assemblage, deposited in a sub-aerial to shallow marine arc-rift environment, is typically bound to the south by the Larder-Cadillac Break (LCB) – which is a major east-trending, south-dipping regional structure that juxtaposed Tisdale mafic to ultramafic rocks (south of the fault) against much younger Timiskaming sedimentary rocks. The LCB lies within the Larder Cadillac Deformation Zone, which is a wide structural zone cutting across several lithologies.
Mineralization
The three main undeveloped deposits on the properties display distinct mineralization:
• The AK deposit consists of lode-style gold mineralization hosted by altered and pyritic Timiskaming volcanic and sedimentary rocks. The deposit is hosted in one of many northeast-trending structures that lie between the Kirkland Lake Main Break and the Larder Lake-Cadillac Deformation Zone. The gold mineralization is of two types: gold-bearing quartz and quartz breccia veins, and gold within pyrite-altered host rocks.
• Upper Beaver is a gold-copper deposit that is mainly hosted in the Upper Beaver alkalic intrusive complex and the surrounding basalts it intruded, and is associated with disseminated pyrite and chalcopyrite, and magnetite-sulphide veining associated with strong magmatic-hydrothermal alteration. The mineralization occurs as elongated tabular bodies that strike northeast, dip steeply northwest and plunge 65 degrees to the northeast. The mineralization has been defined along a 400-metre strike length from surface to a depth of 1,800 metres and it remains open at depth.
• The Upper Canada deposit is hosted primarily in volcanic (trachyte) tuffs and sediments that have been intruded by syenite bodies. Gold mineralization is associated with intensely altered shear zones with fine pyrite and ancillary sulphide mineralization. En-echelon higher-grade lenses are present within a broader envelope of lower grade mineralization.
Exploration
At the AK deposit in 2022, the Company plans to develop a 1.3-km exploration ramp from the existing Macassa Near-Surface Zones (“NSUR”), which is expected to cost approximately $8.6 million. The exploration ramp is designed to provide access to carry out infill drilling and collect a bulk sample from the higher grade portions of the deposit.
Mining of the AK deposit is expected to be similar to the mining activity at LZ5 at the LaRonde Complex. An initial evaluation estimates that production from the AK deposit could begin as early as 2024 and ramp up over a seven-year period. Production is forecast to average approximately 40,000 ounces per year with average total cash costs per ounce of approximately $650-$750.
The forecast parameters surrounding the Company's proposed AK deposit were based, in part, on the results of internal evaluations. These evaluations include inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the forecast production amounts set out above will be realized.
The 2021 exploration results from Upper Beaver are expected to have a positive impact on the next mineral reserve and mineral resource estimate to be included in an internal technical evaluation of Upper Beaver expected to be completed in 2022. The Company is evaluating different scenarios on how to best mine the deposit that starts from surface and remains open below 1.8 kilometres.
The Company believes that Upper Beaver has the potential to be a low-cost mine with annual production in the range of 150,000 ounces to 200,000 ounces of gold and moderate capital outlays. With the merger with Kirkland Lake Gold completed, the Company now has more processing options available including building a standalone mill and tailings facility at site or using an existing mill and tailings facility at either the Macassa mine or the Holt mining complex.
Overall for regional exploration in Ontario in 2022, the Company expects to spend a total of $19.1 million for 53,900 metres of drilling, including: $2.6 million for 12,200 metres for surface exploration drilling at the AK property for mineral resource conversion; $7.9 million for 15,800 metres of drilling at the Upper Beaver and Upper Canada deposits and other targets in the Kirkland Lake camp; and $8.7 million for the Taylor, Hislop, Holloway West and other properties in the Kirkland Lake and Timmins areas that are joint ventures with Melkior Resources, Mistango River Resources, OreFinders Resources and Wallbridge Mining.