Rau Project

Highlights

  • Since 2007, 22 targets with gold and/or base metal mineralization have been discovered across a 20 km trend at the Rau Property;
  • Targets comprise several distinct styles of intrusive-related mineralization, demonstrating systematic zonation outwards from the Rackla Pluton, which represents one of the proposed hydrothermal fluid sources for the district;
  • The neighbouring Bobcat target reflects outward fluid flow and the development of proximal gold-copper skarn mineralization. This mineral zonation continues to transition outwards to a gold-silver dominated carbonate-replacement system exemplified by the Tiger Gold Deposit (NPV5% of $118.2 million and an IRR of 54.5% before tax);
  • At the periphery, silver-zinc-lead manto-style mineralization has developed at the Ocelot target, demonstrating distal components of fluid flow.

Systematic exploration at the Rau Project has revealed an exciting geological environment, which has already led to multiple discoveries and suggests a robust system with significant additional potential.

Rau Geology

The Rau Project lies within a band of regional-scale thrust and high angle reverse faults that imbricate rocks of Selwyn Basin and Mackenzie Platform. Stratigraphy along the Rau Project dominantly consists of Cambrian to Devonian aged carbonates (dolostones, silty limestones, fossiliferous limestones) interbedded with thin mafic volcaniclastic flows, as well as siltstones and shales. A 62 million year old felsic intrusion (the Rackla Pluton) has been emplaced on the western side of the property.

Rau Mineralization

Polymetallic, intrusive-related mineralization has been identified over a 20 km trend and shows systematic zonation outwards from the Rackla Pluton - one of the proposed hydrothermal fluid sources for the district. Mineralized showings discovered to date include intrusive-proximal skarn, through intermediate and distal carbonate replacement and manto systems.


Tiger Au Deposit (carbonate replacement)

Highlights

  • Carbonate-replacement style oxide and sulphide gold mineralization;
  • Total measured and indicated oxide and sulphide resources of 464,000 ounces of gold at 3.19 g/t gold (in 4,526,000 tonnes);
  • NPV(5%) of $118.2 million and an IRR of 54.5% before tax with an all-in sustaining cost of US$661/oz;
  • Pre-production capital cost of $110.1 million and life-of-mine (“LOM”) sustaining capital costs totaling $9.3 million;
  • Total project life of approximately 7 years, including 1 year of construction and pre-stripping followed by 6 years of owner-operated open-pit mining;
  • ATAC has a positive joint decision document for an all-season tote road to the Rau Trend and Tiger Deposit;
  • The Tiger Au Deposit remains open along strike and to depth.

Preliminary Economic Assessment 2020*

Preliminary Economic Assessment 2020

Highlights from the 2020 PEA, with the base case gold price of US$1,400/oz and an exchange rate of CA$1.00 equal to US$0.77 are as follows. Unless specified otherwise, all values are shown in Canadian dollars.

  • NPV(5%) of $118.2 million and an IRR of 54.5% before tax, and an NPV(5%) of $85.4 million and an IRR of 42.6% after tax, with an all-in sustaining cost of US$661/oz;
  • Approximately 267,000 ounces of gold produced at an average diluted grade of 3.82 g/t gold;
  • Total project life of approximately 7 years, including 1 year of construction and pre-stripping followed by 6 years of owner-operated open-pit mining; and,
  • Pre-production capital cost of $110.1 million and life-of-mine (“LOM”) sustaining capital costs totaling $9.3 million.
  • NI 43-101 Technical Report for the Tiger PEA

Mining and Processing

The Tiger Project has been modeled as an owner-operator, conventional truck-and-shovel open-pit mining operation with a conventional CIP gold recovery process. Year-round operations would be supported via a 65 km tote road, which connects the project to the Yukon highway system, near Keno City.

Mineralized material will be loaded into 40 tonne articulated trucks and delivered to the process plant, located 1 km southwest of the pit. Waste material from the pit will be stored in two waste dumps, located at the northwest and southwest sides of the pit. A total of 2.7 Mt of the Mineral Resource and 14.4 Mt of waste rock will be produced during the 7 years of mining and pre-stripping. The life-of-mine ("LOM") average diluted gold grade is 3.82 g/t. The LOM strip ratio (defined as waste material mined divided by Mineral Resources mined) is 5.3:1.

Due to the soft nature of the mineralization and host rock, a single stage of crushing will be performed by a MMD sizer. Crushed material will be ground to 80% passing 75 microns using a semi-autogenous grinding mill and a ball mill in series before cyanide leaching in a conventional CIP circuit. The leached tailings will be detoxified and stored in a lined facility within the Tiger valley. Gold will be refined into doré bars on site through a standard adsorption, desorption and recovery treatment. Based on the results of metallurgical testwork and the mining schedule, projected LOM average recoveries are 90.5% for oxide mineralization and 60.8% for sulphide mineralization.

The processing plant will operate year-round at a rate of 1,500 tonnes per calendar day, and will achieve full throughput in Year 2. Peak annual production will be approximately 72,860 oz of gold in Year 2, with a LOM average annual production of approximately 45,000 oz gold, excluding the final year which will operate for a reduced period.

Table II: Summary of Gold Price Sensitivity (0.77 US$/CA$)

Gold Price (US$/oz) $1,250 $1,300 $1,350 $1,400 $1,450 $1,500 $1,550
Pre-tax NPV(5%) ($M) $74.9 $89.4 $103.8 $118.2 $132.6 $147.0 $161.4
Pre-tax IRR 38.7% 44.1%
49.4% 54.5% 59.4% 64.3% 69.2%


Table III: Summary of Exchange Rate Sensitivity (US$1,400/oz Au)

Exchange Rate (US$/CA$) 0.75 US$/CA$ 0.76 US$/CA$ 0.77 US$/CA$ 0.7 US$/CA$ 0.79 US$/CA$
Pre-tax NPV(5%) ($M) $129.0 $123.5
$118.2
$113.0 $108.0
Pre-tax IRR 58.2% 56.3%
54.5% 52.6% 50.9%

Capital and Operating Costs

Total LOM capital costs are $119.4 million, with $110.1 million in pre-production costs and $9.3 million in sustaining capital. To minimize initial capital costs, the PEA has assumed that modular equipment would be used where possible and that some equipment and facilities will be leased.

The following tables summarize the project capital and operating costs.

Table IV: Pre-Production and Sustaining Capital Costs

Area Pre-Production ($M)* Sustaining ($M)* LOM ($M)*
Site Infrastructure $8.4 - $8.4
Tote Road $11.6 - $11.6
Open Pit Mining** $10.4 - $10.4
Materials Crushing and Handling $2.0 - $2.0
Process Plant $30.4 - $30.4
Tailings and Water Management $8.0 $9.3 $17.3
Project Indirects $20.8 - $20.8
Owner’s Costs $1.3 - $1.3
Contingencies*** $17.2 - $17.2
Total $110.1 $9.3 $119.4

* Totals may not add exactly due to rounding.
** Includes capitalized pre-production mining costs. Major mining equipment is leased.
*** Contingencies were factored on an area-by-area basis depending on the detail level of each estimate.


Table V: Operating Costs

Description LOM Average
Mining Cost ($/t mined)* $4.28
Processing Cost ($/t processed) $29.88
G&A ($/t processed) $15.33
Surface Services ($/t processed) $4.68
Tailings & Waste ($/t processed) $0.64
Camp & Genset Leasing ($/t processed) $1.68
Equipment Leasing ($/t processed) $3.55

*Not including capitalized pre-production mining costs

Tiger Maps & Figures


Airstrip Au Target (blind intrusion)

Highlights

  • The Airstrip Target is located 5 km southeast of the Tiger Gold Deposit
  • Hosts the largest gold-in-soil anomaly on the Rackla Gold Property covering 11.5 km2
  • A first pass rotary air blast (RAB) drill program in 2016 intersected:
    • 1.43 g/t gold over 13.71 m in ASR-16-006
    • 0.66 g/t gold over 22.86 m in ASR-16-004
    • Both holes ended in mineralization due to drill capabilities and are located 430 m apart
  • Prospecting in 2019 returned grab samples grading up to 1.63 g/t gold more than 1 km east of RAB hole ASR-16-006
  • Mineralization occurs in oxidized quartz veins and is thought to occur in the cupola of a blind intrusion
  • Gold-bearing geochemistry reveals a strong association between gold-bismuth-tellerium-antimony similar to Reduced Intrusion Related Gold Deposits (e.g. Eagle Gold, Fort Knox and Brewery Creek)
  • The gold-in-soil anomaly is open to the north, south and east

Bobcat Au-Cu Target (skarn)

Highlights

  • The Bobcat Au-Cu skarn target is located 4.5 km southeast of the Tiger Gold Deposit
  • Hand pitting has identified numerous high-grade gold and copper grab samples along a 280 m strike length; including 41.90 g/t gold with 10.55% copper
  • Diamond drilling intersected high-grade, gold-copper skarn mineralization, including:
    • 17.75 g/t gold over 0.51 m in RPP-19-002
    • 1.53 g/t gold over 6.28 m incl. 173 g/t Au and >1.00% Cu over 5 cm in RPP-19-003
  • Numerous geophysical and geochemical anomalies remain untested along strike

Spotlight Au-Ag Target (skarn)

Highlights

  • The Spotlight Au-Ag skarn target is located 6.5 km north-east of the Tiger Gold Deposit
  • Limited prospecting has returned highlight rock samples grading up to 7,080 g/t silver and 3.27 g/t gold along the 2.2 km long gold-in-soil anomaly
  • Mineralization occurs in limonite bearing quartz veins and brecciated quartz-siderite material
  • The target remains open along strike and has yet to be drilled

Ocelot Ag-Pb-Zn Target (manto)

Highlights

  • The Ocelot Ag-Pb-Zn manto target is located 15 km northwest of the Tiger Gold Deposit
  • The silver-lead-zinc mineralization begins at surface in a large gossan and remains open at depth and along strike
    • OS-11-11 returned 37.91 m of 188.07 g/t silver, 8.69% lead and 6.06% zinc
  • Completed 4,891 m of diamond drilling in 24 holes
  • The Ocelot Target is underlain by a sequence of limestones and dolostones within the equivalent structural corridor that hosts the Tiger Gold Deposit
  • Mineralization consists mainly of medium-to-coarse grained pyrite accompanied with varying concentrations of low iron sphalerite and galena
  • Numerous untested surface geochemical showings nearby
.