The A1 Mine produced most of its current gold from a long hole stope into breccia at the 1380 and 1365 levels PLUS high grade production generated from air leg mining into historic stopes throughout the historic mine-workings. THREE new targets are being developed for ongoing production at A1. We should be getting drilling results shortly into some of these targets.
Air leg mining into historic stopes (where lower grade gold under 20 g/t was abandoned) represents a very significant profit opportunity at both A1 AND Union Hill Mines. Union Hill is part of a 7,000 meter long complex of 7 separate underground and surface mines. Recent work programs within Union Hill have identified multiple opportunities within at least 16 reefs on 19 levels that can be accessed via a recently completed 1,800 meter decline (total cost $17M about 4-5 years ago?). Union Hill currently has a non-JORC resource of 473,000 tonnes @ 12 g/t gold = 182,000 ounces PLUS remnant high grade ore in old stopes.
CTL has produced several million dollars of free cash flow (per quarter) that has been re-invested back into upgrading the process plant at Porcupine, mining equipment and trucks at both A1 and Union Hill and advancing development of underground ore sources at BOTH mines. Additional mullock dumps at Nuggety add 2-3 g/t gold for plant feed.
IMHO the management are trying to fat track production up to a maximum of 150,000 tpa. Every tonne that comes from Union Hill (or environs) saves $58 per tonne in transportation charges. This will fund will upgrade process facilities at BOTH A1 and Union Hill. Saving transport charges at A1 will be sufficient to FUND a new process plant at that location. Currently 25,000 tonnes per quarter = $1.45M on transport.
This should be a 5-10 cent gold stock based on very competent management / production and future potential (on a rising gold price).
CTL Price at posting:
1.4¢ Sentiment: Buy Disclosure: Held
