The key operational focus is restarting sustainable production in the second quarter of 2021.
Expanding the open cut, extensive infill drilling and detailed block modelling in the first quarter will lay the foundation to achieve production midyear. The 10,000 metre drill program will close spacing for the mine plan and further define the resources into reserves.
The process plant on care and maintenance will be upgraded to deliver 6600 tonnes of ore per day to the process plant at a minimum grade of 1.55 g/t. The process test work and modifications are expected to increase the historical recovery from 87.5% to 90 percent against 91% in test work. These improvements will result in a production rate of up to 95,000 ounces per year of gold dore. While operational, John T Boyd (Denver) will conclude a NI 43-101 feasibility.
In the long term, our mission is to create a mid-tier gold mining house that leverages technological innovation to produce value for our shareholders and pioneer the best environmental and safety practices. The aspirations of our staff, shareholders and community are the driving force of the company.
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Otso Gold is located in Finland some 15 kilometres south of the town of Raahe, a Finnish town with a major port and 80 kilometres from Oulu, a city with an international airport. The mining leases cover 1551.93 hectares, excluding another 4031 hectares of exploratory leases. The mine was designed and built by leading Finnish mining and equipment companies, Outotec and Metso Minerals in the heart of one of the world’s leading mining jurisdictions. The site is easily accessible by all-weather roads.
FULLY LICENSED AND PERMITTED
All licenses for operation are in place.
All permits to mine are in place and current.
Environmental permits for mining and tailings facilities are current and all continued requirements for monitoring have been met.
Mine has all permissions and approvals to mine and process material today.
GEOLOGY AND MINERALISATION
The Otso gold deposit is located in the Svecofennian orogenic belt, part of the Archean-Palaeoproterozoic Fennoscandian Shield, which formed during northeast vergent collision between multiple calc-alkaline volcanic arc complexes and microcontinents with the foreland Karelian Craton approximately 1900Ma.
The Svecofennian orogenic belt is divided into three arc complexes: the Savo Belt, central Svecofennia, and Southern Svecofennia. The Otso gold deposit is in the 450 km long Savo Belt, immediately adjacent to the Raahe-Ladoga suture. The Savo Belt comprises supracrustal mafic-ultramafic volcanic and volcano sedimentary rocks, and accretionary prism nappe complexes, which have been intruded by mafic plutons and several generations of granitoid stocks and dykes. These Svecofennian units are variably folded and faulted and display lower greenschist through to amphibolite facies metamorphism. Younger mafic dykes and sills formed during a later period of extension and crosscut the Svecofennian stratigraphy.
Gold mineralization in the Savo Belt occurred post-peak metamorphism and formed two main gold districts: the Raahe-Haapajärvi district in the northwest in which the Otso gold deposit is located, and the Savo District in the southeast.
The Otso-Oltava project area comprises lozenges of mafic metavolcanic rocks with intercalated meta-volcano sedimentary horizons. Metagreywackes occur as boudins and slivers to the east and west of the metavolcanic units. These supracrustal units typically strike north-south, sub-parallel to the regional structural fabric. Quartz diorite to granodiorite plutons intrude the supracrustal strata and occupy the central and eastern part of the project area. All units are intruded by granitic plutons and dykes, and later mafic (dolerite) dykes. The entire project area is overlain by glacial till and sand deposits between 3 and 15 metres thick.
The Otso Gold Mine is comprised of mafic meta-volcanic rocks intercalated with rare meta-volcano sedimentary horizons and intruded by quartz diorite plutons and dykes. Together, the metavolcanic and quartz diorite are the main host to mineralization.
Mineralization comprises sheeted quartz-sulphide vein arrays within multiple, sub-parallel, mylonitic shear zones, hosted in metavolcanic and quartz diorite rocks. Mineralization occurs in two main bodies, the North Pit with Eastern Extension in the north, and the South Pit in the south.
The state-of-the-art process plant was designed to treat 2 million tonnes per annum hosting:
Single stage crushing
Two 3 MW mills and flash flotation
Gravity circuit and regrind circuit
Two CIL plants (high and low grade)
Two tailings dams (high and low grade)
Six tonne dual vessel COMO stripping plant
18 kilometre of discharge water pipeline into the ocean
20MW installed grid power.
The process plant is ‘gold plated’ with an estimated cost of delivery of € 250 million. The plant was commissioned at the end of 2011.
The process plant has produced 72,000 ounces of gold with an 87.5% recovery against an expected test work recovery of of 91%. Given the optionality of the circuits, Otso will improve recoveries by fine-tuning, flash flotation and regrind.
Otso Gold is a fully developed mine with a ‘gold plated’ process plant designed to manage any operational requirements.
The properties were discovered by and owned by Outokumpu Mining. Otso Gold purchased the Otso Gold Mine from a Swedish Company in 2017.
The Company has been the subject of reports by the worlds largest engineering Companies, confirming the quality of the resources. CSA Global worked onsite between 2005 and 2013 carrying out technical studies, pre-feasibility studies and feasibility studies. In 2015, SRK completed RC drilling of the pit floor and prepared a technical report to support the restart. In 2018, a Canadian company contracted Boyd to complete a NI 43-101 PEA and was audited by RMP.
The critical flaw of the mines two former restarts was the failure by the management team to implement the recommendation of numerous technical reports, specifically infill drilling and grade controls. The owners rushed to restart the mine without sufficient technical expertise, sufficient technical work completed and in the middle of winter. The current management team has significant technical expertise and is focused on completing the recommended technical work to ensure the long term sustainable operation of the project.