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Rainy River Resources Completes Feasibility Study: Establishes Intermediate Production Profile With 4.0 Million Ounces Of Gold In Proven And Probable Reserves

Infrastructure

The RRGP benefits from world-class infrastructure, services and available labour in the immediate area. The project site is located only 65 km from the town of Fort Frances (population 8,000) and is accessible year-round by a network of sealed provincial highways.

Infrastructure is anticipated to include:

  • Plant site and haul roads, gate house, parking, bus station and weigh station;
  • Separate administration building, mine office and process building;
  • Assay lab;
  • Mine maintenance garage, warehouse;
  • Fuel storage facilities;
  • Fresh water supply and fire protection;
  • Sewage treatment;
  • One tailings management facility;
  • Two mine rock overburden/rock stockpiles;
  • Various water management ponds;
  • Power to the project supplied by a new 17 km long 230-kV transmission line connecting to the provincial power grid, with the total power draw expected to be 57 MW.
  • Highway 600 realignment, east access road.

Operating and Capital Costs

Total operating costs for the RRGP are summarized in Table 3 (a) as follows:

Table 3 (a) - Average Life-of-Mine Operating Costs (in Canadian dollars per tonne)


    Cost Structure                  Unit         Costs per Unit
    --------------                  ----         --------------
    Open pit mining              C$/t mined          $1.95
    Underground mining[1]        C$/t mined          $75.52
    Open pit mining[2]          C$ / t milled        $7.19
    Underground mining[1]       C$ / t milled        $2.02
    Processing                  C$ / t milled        $8.65
    General & Administrative    C$ / t milled        $1.21
    Refining expenses           C$ / t milled        $0.14
    Royalties                   C$ / t milled        $0.54
    Total                       C$ / t milled        $19.75

Notes: 1.    Weighted average of long hole and cut and fill underground mining costs. 2.    Stockpile reclamation costs of $0.337 per tonne milled is included in Open pit mining costs.

Total cash costs for the RRGP are summarized in Table 3 (b) as follows:

Table 3 (b): Average Gold Cash Costs [ 1, 2 ]

     Area                                 Initial 5    Initial 10      LOM
                                            Years        Years        US$/oz
                                          US$/oz Au    $US/oz Au        Au
                                          ---------    ---------      ------
    Mining (Open Pit and Underground)[3]    $225          $268         $275
    Processing                              $184          $188         $258
    General and Administrative               $27          $28           $36
    Refining Expenses                        $4            $4           $4
    Royalties                                $6           $18           $16
    Silver Credit                           $(33)        $(38)         $(45)
    Total Cash Costs                        $413          $468         $544
    Notes:
    1.               Includes silver credit and royalty payments.
    2.      Cash costs include the mining cost of stockpiled material recorded
                                in the periods in which
            the material is processed and revenue recognized, in accordance
                                    with IFRS.
    3.       During years with high stripping ratios (>3.10), the operating
                              costs associated with rock
         waste material have been capitalized and excluded from cash costs.

 

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