Rubicon made deep cuts to resources at its Phoenix gold project and signaled the end to its ambitions to bring the deposit, which has seen near $1 billion in exploration and development spent on it, to production.
A revised resource, updating a 2013 estimate, paints a dramatically different picture of the Phoenix project, in the Red Lake gold district, Ontario.
Indicated tonnage drops 88% and grade 21% from 4.1mt @ 8.52 g/t Au to 0.492mt @ 6.73 g/t Au.
Inferred tonnage drops 80% and grade 32% from 7.5mt @ 9.26 g/t Au to 1.5mt @ 6.28 g/t Au.
Rubicon included new drilling and data from underground development in the new resource, produced by SRK as before.
But at its heart the new model assumes far less continuity of high-grade resources than before.
“The 2016 SRK Geological Model demonstrates that the F2 Gold Deposit is more geologically complex and the high-grade gold mineralization is less continuous than previously understood,” Rubicon notes in a press release.
Until late last year Rubicon was ramping up the deposit to production in a troubled ~$400 million mine-build. But with far fewer resources to work with now, Rubicon said any trial stoping would end – deeming it uneconomic – and that the project would require further exploration to develop more resources.
Rubicon said it would now consider strategic options as it advanced discussions with project lenders. It retained BMO Capital Markets, TD Securities, and Stikeman Elliott for the strategic review.
Rubicon planned a conference call to discuss the resource at 10:30 EST, Monday.
More to come…