Victoria Gold (VGCX) - Onsite Visit with John McConnell

Victoria Gold Corp is a Canadian gold production company, focused on its gold-producing asset, the Eagle Gold Mine. The Eagle Gold mine is an open-pit gold mine located 80 km south of the village of Mayo. The operation is situated within the company’s Dublin Gulch property and produces gold doré from a three-stage crushing plant, an in-valley heap leach and a carbon-in-leach adsorption-desorption gold recovery plant. The mine is accessible year-round and is able to accommodate its fly-in/fly-out (FIFO) personnel that work on a rotational basis.

Project 250, the company’s endeavour to produce 250,000 ounces of gold by 2023, has, due to various delays, been extended to 2023. Project 250 consists of two improvement initiatives; the first initiative is the installation of a scalping plant which is planned to be installed between the secondary and tertiary screening and crushing plants of the operation’s processing facility.

The scalping plant is intended to mitigate the effect of fine ore, created by drilling and blasting activities, on the screening and crushing system and will enable a higher throughput of mineralised material. The second initiative of the company is the adjustment of the operation’s seasonal stacking plan.

The stacking of ore on the heap-leaching pad of the operation is planned to occur 11 months of the year, with the twelfth month of the year dedicated to annual maintenance. The rationale behind adjusting the stacking schedule is that various other mines in the surroundings are able to stack year-round and not experience any drop in leaching solution temperature and leaching rate due to environmental factors.

The company is also underway with a large-scale exploration program at its Dublin Gulch property. The exploration program is aimed at identifying and expanding the mineral reserves of the property and will initially target the Raven deposit of the property. The exploration drilling program is envisioned to consist of 25,000 m of diamond drilling, with the funds allocated to the program planned to be CAD$ 20 million over two years. The exploration initiatives will enable the company to create a mineral resource estimate (MRE) for the deposit.

Victoria Gold Corp. on the 12th of July 2022, published its Q2 2022 production results. The company in the period between April 1 and June 30 produced 32,055 ounces of gold at the Eagle Gold mine. The production rate of Q2 led to the total amount of gold produced at the Eagle Gold mine in the first half of 2022 to be 56,413 ounces of gold.

Eagle Gold Mine

The Eagle Gold mine is an open-pit gold operation located 80 km south of the village of Mayo. The operation is situated within the company’s Dublin Gulch property and produces gold doré from a three-stage crushing plant, an in-valley heap leach system and a carbon-in-leach adsorption-desorption gold recovery plant. The mine is accessible year-round and is able to accommodate its fly-in/fly-out (FIFO) personnel working on a rotational basis.

The Dublin Gulch property hosts both the Eagle deposit as well as the Olive deposit. The Eagle deposit, currently being mined, holds within it a total of 148 million tons of proven and probable mineral resources which total approximately 3 million ounces of gold. The Olive deposit is a smaller deposit of the property and holds 7 million tons of proven and probable mineral resources which total approximately 0.2 million ounces of gold.

The eagle gold mine extracts gold through a heap-leaching process, which is planned to consist of two heap-leaching pads. The two heap-leaching pads will serve as primary and secondary pads for the process, with the intent being to implement the primary heap-leaching pad for the initial 8 years of production, whilst the secondary heap-leaching pad is developed.

The ore stacked on the heap-leaching pad is obtained from a three-stage crushing plant, which delivers a product with an 80% passing size of 6.5 mm. The gold mineralisation of the product is leached through a cyanide solution and recovered through an adsorption-desorption regeneration (ADR) carbon plant located near the heap-leaching pad to minimise the pumping distance.  

Project 250 update

Project 250 is the endeavour of Victoria Gold Corp. to produce 250,000 ounces of gold by 2023. The project aimed to reach 250,000 ounces of gold in 2022, but due to various delays, has been extended to 2023. Project 250 consists of two improvement initiatives, namely the installation of a scalping plant, which will remove fine ore material from the crushing circuit and secondly the adjustment of the company’s seasonal stacking schedule.

The scalping plant is intended to mitigate the effect of fine ore, created by drilling and blasting activities, on the screening and crushing system of the processing plant. The scalping plant is planned to be installed between the secondary and tertiary screening and crushing plants in the processing facility and will enable a higher throughput of mineralised material. The installation of the scalping plant will see the processing facility’s throughput increase by 15% to 20%, which will create an increase of annual ore stacked on the heap-leaching pad by approximately 1.5 million tons.

The scalping plant initiative is still planned but has, due to supply chain issues, seen various delays. John McConnell the President and CEO of Victoria Gold Corp. explains the delays as follows:

“We ordered this screen deck for scalping back in November of last year (2021) and it just kept getting extended out. We thought it would be delivered by June of this year. Now, they're suggesting it might be as late as November of this year. So that's the kind of things we're dealing with.”

The second component of project 250 is the adjustment of the stacking schedule of the operation’s heap-leaching pad. The stacking of ore on the heap-leaching pad of the operation is planned to occur 11 months of the year, with the twelfth month of the year dedicated to annual maintenance. The rationale behind adjusting the stacking schedule is accredited to various other mines in the surroundings being able to stack year-round and not experience any drop in leaching solution temperature and leaching rate due to environmental factors. McConnell explains that the company will reach year-round stacking in 2022 still, he states:

“The biggest component of Project 250 is going to year-round stacking and we're very confident we'll get to year-round stacking this year, we'll still need a few weeks of maintenance downtime in January, but where we were shut down for 8-weeks last year, we're scheduling 4-weeks into 2023. So that's a big step towards Project 250.”

The supply chain issues and cost implications have not cancelled Project 250, with McConnel explaining that Project 250 is still planned and will be implemented, it will however be at a later stage, he states;

“…scalping is still in the plan, but you know, the plant itself, the costs went out of control so we pulled back. I guess in some ways, we've said let's learn before we run and make sure we get a solid 200,000 ounces of gold a year before we're going to have that big step up to 250,000 ounces. Still very achievable but it will probably be later in 2023 before we achieve it”

Exploration Initiatives

Victoria Gold Corp. is currently underway with a large-scale exploration program at its Dublin Gulch property. The exploration program is aimed at identifying and expanding the property’s mineral reserves with the program initially focused on the Raven deposit of the property. The exploration drilling program will consist of 25,000 m of diamond drilling, with the funds allocated to it planned to be CAD$ 20 million over two years. The exploration drilling will enable the company to create a mineral resource estimate (MRE) for the deposit. McConnel explains the company’s planned exploration program as follows:

“…we have a very large exploration programme this year. We currently have three drills running, we actually have 4 drills in place but again, it's a people problem. We hope to have the 4th drill up and running here within the next 3-weeks. We've drilled 10,000 m to date, some plus 40 holes, and this is all Raven, which is east of Eagle. In the program, our budget this year is CAD$ 20 million. I shouldn't say this year, over a 2-year period is CAD$ 20 million and we hope to have the maiden resource in Raven out by the end of the year.”

Q2 2022 production results

Victoria Gold Corp. on the 12th of July 2022, published its Q2 2022 production results. The company in the period between April 1 and June 30 produced 32,055 ounces of gold at the Eagle gold mine. The production rate of Q2 led to the total amount of gold produced at the Eagle Gold mine in the first half of 2022 to be 56,413 ounces of gold.

The Q2 2022 production results show 2.2 million tons of ore mined at the operation, which is slightly less than the amount of ore mined in Q2 2021 which stood at 2.3 million tons. The company also mined 2.2 million tons of waste rock at the operation, which is down from 3.3 million tons in Q2 2021. The operation’s strip ratio improved to 1, up from 1.5 in Q2 2021, with the total ore stacked on the heap-leaching pad being 2.3 million tons. The total amount of ore stacked is less than Q2 2021 which was 2.4 million tons. The grade of the stacked ore is also higher than the previous quarter being 0.85 g/t of gold, an improvement from 0.81 g/t of gold in Q2 2021.

The total ounces of gold produced at the operation is marginally down from 32,140 ounces of gold to 32,055 ounces of gold in Q2 2022. Victoria Gold Corp. is however confident that it will reach its previously stated guidance range of 165,000 to 190,000 ounces of gold and believes that as history has shown, the second half of the year will see higher production rates.

Future

The company plans on continuing its exploration initiatives at the Dublin Gulch property in the coming year, with the previously noted 25,000 m diamond drilling program aimed to expand the project’s mineral reserves and the life of the mine. McConnell explains the company’s intent as follows:

“We'd all like to grow the company and become a multi-asset mining company. But you know, we've got a lot of projects in North America and we think the best way to grow is in our own backyard. Projects like Raven, and Lynx, we think that's the best opportunity for growth in the future.”

The company is also not opposed to an acquisition but is also not actively investigating any acquisition endeavours, McConnell states:

“We field a lot of inquiries from mid-tier and senior companies and I expect that to continue. We still don't think this is the right time to be selling Victoria so we're not carrying out an active process but if somebody calls and wants to have a closer look at Victoria, we're open to doing that.”

The continued implementation of Project 250 as well as the company’s historical seasonal production rates, promises to keep the remainder of 2022 a promising time for Victoria Gold Corp. 

To find out more, go to the Victoria Gold website