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Mark Vaughan-Jackson: There’s gold in them thar hills

Sherry Dunsworth, left, senior vice-president of exploration with Marathon Gold is seen with company president and CEO Phillip Walford at the company's Valentine Lake Gold Camp in central Newfoundland.
Sherry Dunsworth, left, senior vice-president of exploration with Marathon Gold is seen with company president and CEO Phillip Walford at the company's Valentine Lake Gold Camp in central Newfoundland. - Contributed

Marathon Gold releases major increase in gold resources at Valentine Lake Gold Camp in central N.L.

I can’t tell you how long I’ve wanted to use that headline in The Telegram.

This week I got my chance. And while the “hills” part might be a little artistic licence on my part, the “gold” is right on the money.

It’s a busy week for the Newfoundland and Labrador mining and mineral sector. Right now the Delta in St. John’s is playing host to Mineral Resources Review 2018 — the largest mineral industry conference and trade show in eastern Canada.

It’s also a busy week for the folks at Marathon Gold as they chat with passersby at their display both. This week Marathon released the latest figures on its Valentine Lake gold camp. Company brass were expected to give a presentation on the latest results at the conference today.

These results suggest a total gold resource of 4.2 million ounces at the Valentine Lake property in terms of both measured and indicated gold as well as inferred gold deposits. That’s valued at about $6.6 billion.

After a quick wander through the trade booths, I sat down with Marathon senior vice-president of exploration Sherry Dunsworth for some details on the scale of these latest results.

Marathon has been exploring at the Valentine Lake site since 2010, on the Marathon Deposit specifically since 2014. It’s a property that covers 24,000 hectares along the Valentine Lake thrust fault, slightly south and west of Buchans and Millertown.

From Dunsworth’s perspective, these latest results are hugely important, both for the company and the province as a whole.

“What does this mean for the province? It means that we know, with having 4.2 million ounces and growing, there’ll be a mine,” Dunsworth said. “And at this scale of mine site that we’re looking at … this is 12 years of mine life with a few years of tail-off after that and 350 jobs. For construction, you’re talking more than 500 jobs in construction, high-paying jobs.”

But there’s a lot more work ahead to get to that point, she advised. More drilling exploration, more environment work, regulatory requirements, and a pre-feasibility study, due out in 2019.

Lots still to do, but these latest numbers come as validation for Marathon.

“What’s the big catch here? Nobody believed that there were deposits of gold in Newfoundland bigger than a million ounces,” Dunsworth said. “Nobody believed we have an orogenic system that isn’t maybe as rich in terms of grade, but is equally as big as some of the stuff in Val D’Or (in Quebec). The whole Kirkland Lake Belt (in Ontario) fits into just our property. That’s the scale.”

And it should also be pointed out that these latest numbers are literally just scratching the surface. The drilling and analysis work has been carried out on a tiny portion, perhaps 15 per cent, of the total area of the property.

There are a couple of options for the future and development of a mine and mill. Marathon could raise the millions needed to develop and operate it on its own, or a larger mining company could buy the property and work on it itself.

What route is taken depends on a lot of things, Dunsworth said, not least of which is what Marathon’s shareholders want to do.

But the inescapable fact is that, based on these numbers, there will be a mine there someday. And it will be a big one.

“When you think of the scale of the open pits that would be there, you’re talking the size and the scale of what’s up in Labrador with the iron ore,” Dunsworth said. “We’re talking huge pits. This is a huge operation. And to say we could go to 20 years (mine life), I don’t think is an exaggeration.”

As to when this could happen, notwithstanding all the exploration, environmental, regulatory and financial work still ahead, it could be sooner than you think.

“We have a lot of work before then. We have ongoing environmental studies, which are critical. We have ongoing metallurgical studies … but as we go into the pre-feasibility study, we’ll be actually putting the project forward for environmental assessment and to the Canadian Environmental Assessment Agency,” Dunsworth said. “We’re following all the steps and unless something drastic were to change in the world, four to five years would be the outside.”

And what’s good news for Marathon could also spell good news for the other mining companies at various stages of exploration work up and down the same geological thrust that Valentine Lake sits on.

“This a major thrust that goes through all of Newfoundland and there are all these staked claims where are people looking. … The potential is there along this belt. It has the same geology along the strike. It’s a massive system and it doesn’t just stop at our property,” Dunsworth said.

If you’re interested in the more technical side of Marathon’s results, visit marathon-gold.com.

Mark Vaughan-Jackson is The Telegram’s business editor. He can be reached via email at Mark.vaughan-jackson@thetelegram.com. Twitter: @Telebookmark


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