Victoria Gold (ticker VIT on TSX) announced that the Yukon Environmental and Socio-Economic Assessment Board (YESAB) has concluded its environmental assessment and issued a Final Screening Report and recommends that the Government of Canada and Yukon Government allow the Eagle Gold Project to proceed.
The Eagle Gold Project is expected to be Yukon’s next operating gold mine and includes Probable Reserves of 2.3 million ozs of gold, containing 4.9 million ounces of gold in the “Indicated” category. So 7.2 M oz. in total. Victoria first submitted a Project Proposal, initiating the environmental assessment process, in December 2010. Over the past two years YESAB has consulted with the general public, First Nations, Yukon Government, Federal agencies and Victoria’s permitting team to assess the environmental and socioeconomic effects of an economically robust project while maintaining strict environmental and safety standards. The Eagle Gold Project planning and assessment process has benefitted from the existing Benefits Agreement between the First Nation of Nacho Nyak Dun and Victoria.
The Yukon Water Board must still issue a water license before mining could occur. However, it is expected that construction activity will occur in a few short weeks leading to full production in 2015.
It will cost $430 M to bring the mine into production. Victoria is looking at asset sales to raise up to $60 M and debt to finance up to $210 M. The residual will be finance through equity means, or sale of production streams or specialized financial instruments.
Unfortunately, for VIT’s long suffering shareholders, some equity dilution seems inevitable in this very tough equity market. VIT’s shares once traded at over $1.40 now trade at $0.22. They jumped by 10% today with the announcement soothing the pain of recent months.
Yukon actual has no producing gold mines, just some small but significant placer mining operations. The Eagle project could well lead to a long term gold mine, beyond 10 years if VIT finds more reserves. It will be a nice medium sized mine near Mayo providing good paying jobs to dozens of Yukoners. Congratulations Victoria Gold !