NYSE: KL 13.32 +0.00 +0.01% Volume: 346,553 20 min delay October 18, 2017
TSX:KL 16.60 -0.03 -0.18% Volume: 492,629 October 18, 2017
GOLD PRICE USD 1,281.61 -4.34 -0.34% Volume: October 18, 2017

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Macassa Mine

The Macassa Mine is a high-grade gold producer, with grade improving at depth, and a key valuation driver for the company

Quick Facts

Macassa mill, interior

Location Town of Kirkland Lake, 580 km north of Toronto, Ontario
Mine type Underground, shaft access
2017 Production Guidance 190,000 – 195,000 ounces
Deposit type Orogenic greenstone hosted gold (Lode Gold deposit)
Process Carbon in Pulp (CIP)
End product Gold doré
Infrastructure #3 Shaft, 2,200 tpd capacity
Macassa Mill, 2,000 tpd capacity
Commenced Operation 2002 by Kirkland Lake Gold, producing since 1933.
Resources & Reserves

Overview

The Macassa Mine, located in the Town of Kirkland Lake, Ontario remains one of the highest gold grade mines in the world. Macassa commenced operations in 2002, and with the discovery of the South Mine Complex (SMC), has been able to increase its level of production significantly over the past five years. The SMC has been driving grade improvement at Macassa, with results from ongoing drilling to likely provide further growth in adding higher margin tonnes to augment mill feed. Kirkland Lake Gold is also expanding the resource at shallow depths, both at surface and from the '’04 Break and Main Break zones.

The mine is located in an area with well-developed infrastructure, including a provincial highway, a railway system and a private airport. High-grade ore is processed at the Macassa Mill, which currently has available capacity and is located in close proximity to the mine.

Operating Data

Empty Year Ended
December 31st 2016
8 months ended
December 31st 2015(1)
Year Ended
April 31st 2015
Year Ended
April 31st 2014
Gold produced (oz) 175,167 102,597 153,957 122,309
Ore processed (tonnes) 396,633 248,824 335,636 385,836
Gold grade (g/t) 14.10 14.4 13.43 10.96
Recovery (%) 97.1 97.1 97% 95.4
Operating cost (US$/oz) $527 $612 $723 $1,019

(1) - The Company has changed its fiscal year-end from April 30 to December 31. As such, the current 2015 reporting period was for an eight-month period being May 1, 2015 to December 31, 2015 (the “stub year”, “SY15”)

Mining Method and Processing

Mining at Macassa is currently underway at an average rate of 1,000 tpd across two mining horizons: the historical Main/’04 breaks (20% of the annual throughput) and the new SMC Zone (80% of the annual throughput) with access via #3 shaft. In the Main/’04 breaks, mining is taking place between the 3400 and the 5300 levels. In the SMC Zone, mining will occur between the 5000 and the 5800 levels; the Company will complete the development of a haulage ramp down to the 5800-level elevation in 2017 and further it down to the 6000-level elevation by the end of 2018.

Mining is conducted primarily via overhand and underhand cut-and-fill and a small portion of long hole methods. All stopes are backfilled with either paste fill, cemented rock fill or loose waste rock. The Macassa Mine was the first mine in the world to use lithium ion battery operated trucks and loaders, which has allowed the Company to maintain its production rate.

The Macassa Mill was constructed in 1986, originally designed for a throughput of 725 tonnes per day. The mill underwent additional expansions and was upgraded to handle 2,000 tpd. Processing of ore at Macassa starts with crushing and grinding to a particle size of 45μm before it enters the leach tanks for cyanidation. Then, it flows through a carbon-in-pulp (CIP) circuit, followed by a Merrill-Crow recovery system. The concentrate is melted in an inductotherm induction furnace where doré is poured and typically contains 85% to 88% gold.

Geology & Mineralization

The gold mineralization at Macassa is found along breaks or faults, in veins as quartz filled fractures, as breccias and as sulphide rich (pyrite) zones. There are multiple mineralized breaks, named the ‘04, ‘05, No.6, Kirkland Lake Main and the Kirkland Lake North and South branches. The breaks strike N60°E and dip 70-80° south in keeping with the Timiskaming trend. The trend of the gold mineralization in the Kirkland Lake camp conforms to the 60° westerly plunge of the syenite intrusives.

The South Mine Complex (SMC) has been a very significant new find as it has a different character than zones that have been mined historically at Macassa. The SMC is associated with a cross-over structure which links the ’04 / Main Break with the Amalgamated Break. The mineralization trends parallel to the main structures but has a much flatter dip ranging from 20-50° south. SMC mineralization has been found to have greater widths and contain higher grades than the main zones. There is great exploration potential with a strong possibility for additional parallel and stacked zones located above, below and along strike.

Exploration

In 2012, Kirkland Lake Gold acquired the Hurd McCauley claim, along with the South, East and North claims, facilitating expansion drilling of the SMC in multiple directions.

Current exploration programs at Macassa are focused on underground drilling and drifting (on the 5300 Level), and include the delineation and extension of the SMC to the east, west and to depth, and testing of the `04 and `05 Breaks from the 4250 and 4500 levels. Significant results to date in 2017 include the extension of the SMC 259 metres to the east and the intersection of high-grade mineralization in a new hangingwall gold system discovered on the Lower SMC

The Company is also continuing a regional surface drilling program, testing for mineralization associated with the SMC Zone to the east, and also with the Amalgamated and Main Breaks. Recent drilling intersected high-grade gold mineralization which the Company believes may be associated with, and hangingwall to, the Main Break, with additional drilling planned to follow up on this new exploration opportunity.