Back River Gold District - Canada
Following the acquisition of Sabina Gold & Silver in April 2023, B2Gold acquired Sabina’s 100% owned Back River Gold District located in Nunavut, Canada. The Back River Gold District consists of 5 mineral claims blocks along an 80 km belt. Construction is underway at the most advanced project in the district, the Goose Project, and has been de-risked with significant infrastructure in place.
At US$1,600 gold, a March 2021 Updated Feasibility Study on the Goose Project delivers an after-tax NPV5% of C$1.1 billion and an after-tax IRR of 27.7%. At 6 g/t Au, these are the highest grade undeveloped open pits in the world.
B2Gold recognizes that respect and collaboration with the Kitikmeot Inuit Association is central to the license to operate in the Back River Gold District and will continue to prioritize developing the project in a manner that recognizes Inuit priorities, addresses concerns and brings long-term socio-economic benefits to the Kitikmeot Region. B2Gold looks forward to continuing to build on its strong collaboration with the Kitikmeot Inuit Association and Kitikmeot Communities.
Following the successful completion of the 2023 sealift, construction of the 162 km winter ice road (“WIR”) between the Marine Laydown Area (“MLA”) and the Goose Project site began in December 2023. The 2024 WIR campaign completed on April 30, 2024, and B2Gold is pleased to report that the Company has successfully delivered all necessary materials required to complete construction of the Goose Project. Materials trucked from the MLA to the Goose Project site during the 2024 WIR campaign exceeded 2,100 total loads and included 400 loads of diesel fuel. Key materials delivered during the 2024 WIR campaign included all modular units necessary to expand the camp to 500 person capacity; all steel and rebar necessary to complete the mill and concrete work; approximately 19 million liters of fuel that will be used between May 2024 and March 2025; all cement necessary to complete the construction project; more than 4,500m3 of cement in one ton bags; and all reagents necessary to commission and operate the mill starting in 2025.
As of the end of April 2024, all additional camp modules were on site and set in place. The camp will be expanded from 300 beds to 500 beds through six additional dorm wings and a small office complex wing. More than 120 new additional beds are currently ready to be occupied, with the full accommodation complex expansion expected to be complete by the end of May 2024.
B2Gold is expanding the existing diesel storage tank farms at the MLA and at the Goose Project site from 25 million liter capacity to more than 80 million liters. This increase requires the addition of three more tanks at each site. All the steel required to complete the tank expansion is present at each site, and construction crews have commenced assembling the tank bases. These tanks will be complete by the end of August 2024 to receive the sealift shipment of fuel that will sustain the project through the end of construction and into production in 2025.
The mill construction remains on schedule (with certain items ahead of schedule) with work ongoing on various facilities related to concrete, steel erection and building cladding. Installation of the ball mill is progressing ahead of schedule with the installation of all shell sections, feed/discharge heads, trunnion, pinion and bearings having been completed.
The primary pond will provide contact water storage as well as store reclaimed water during the first year of processing operations. It is critical for the primary pond to receive water in 2024 for mill start-up and commissioning. The facility embankment includes a frozen core that requires a below grade cut-off trench to be constructed during the winter months. The cut-off trench was successfully completed in April 2024. Phase 2 of the embankment will be completed during summer 2024.
Development of the open pit and underground is slightly behind schedule due to equipment availability (commissioning and availability of open pit equipment), adverse weather conditions and prioritization of critical path construction activities. The current schedule indicates that an additional three months of mining must be added to the schedule to ensure that the Umwelt open pit, underground development, and crown pillar activities align and that there is sufficient tailings storage capacity in the Echo open pit. With the schedule change, the mill is now scheduled to produce first gold in the second quarter of 2025 with ramp up to full production in the third quarter of 2025 (one quarter later than previous estimates). This does not impact the other facets of the project and staffing tables have been adjusted to ensure that capital is conserved. With the updated schedule, the Company estimates that gold production in calendar year 2025 will be between 120,000 and 150,000 ounces (previously estimated to be between 220,000 and 260,000 ounces). The reduction in estimated gold production in 2025 is predominantly due to the deferral of an anticipated 100,000 ounces of quarterly gold production from the fourth quarter of 2025 into the first quarter of 2026. Importantly, the updated mining schedule does not impact the total number of gold ounces the Company expects to produce over the life of mine of the Goose Project. The updated production profile has resulted in the Company now estimating that average annual gold production from 2026 to 2030 will increase to be in excess of 310,000 ounces per year (previously estimated at 300,000 ounces per year).
After completing a detailed design review of the Goose Project, B2Gold announced in January 2024 a revised construction capital estimate to C$1,050 million. In addition, before first gold production the Company estimated it will spend an additional C$200 million on underground development, deferred stripping and sustaining capital, as well as an additional C$205 million for fuels, reagents, and other working capital items necessary to build up site inventory levels due to the seasonality of the project logistics. As of December 31, 2023, approximately C$683 million had been spent on construction and mine development activities and C$44 million for the build-up of supplies inventory. In the first quarter of 2024, the Company incurred $117 million (C$158 million) for the Goose Project on construction and mine development activities and $2 million (C$3 million) on supplies inventory. As at March 31, 2024, approximately C$841 million in cash expenditures had been spent on construction and mine development activities and C$47 million on supplies inventory.
Nunavut: Canada's Newest Mining Friendly Territory
On April 1, 1999, the Territory of Nunavut was formed. The groundwork was laid by the signing of the Nunavut Agreement (the “Agreement”) in 1993 between Inuit of the Nunavut Settlement Area and Her Majesty the Queen in right of Canada. As a result of the Agreement, Inuit are the largest landowners in the Territory and a process of environmental assessment and permitting was established. Mineral resource development remains an important economic driver in the Territory. The development of mining projects in the West Kitikmeot region has far reaching impacts, not only for our shareholders but also for the government and residents of the Territory. The Territory has a well established and sophisticated environmental review process allowing all parties to participate in open and transparent review processes. The first project at Back River, the Goose Project, has progressed through this process and is now fully authorized for construction and operations. The development of the Goose Project opens the Back River Gold District for opportunities yet to be discovered.
Additionally, a 20-year renewable land use agreement (Framework Agreement) has been signed with the Kitikmeot Inuit Association which includes an Inuit Impact and Benefit Agreement. Strong support for the Project has been shown by Kitikmeot communities who contribute to the ongoing development of the Project in an environmentally and socially responsible manner.
Supporting documents:
For the latest details and news releases pertaining to the Back River Gold District:
- Click here for B2Gold’s Q1 2024 Earnings (dated May 7, 2024)
- Click here for B2Gold's news release: B2Gold Announces Positive Exploration Drilling Results from its Inaugural Drilling Campaign at the Back River Gold District in Nunavut and Provides an Update on Construction and Mining at the Goose Project (dated November 21, 2023)
- Click here for B2Gold’s news release: B2Gold Provides Construction Update for the Goose Project in Nunavut, Canada; Construction on Budget and on Track to Pour First Gold in Q1 2025 (dated September 18, 2023)
- Click here for B2Gold’s news release: B2Gold Provides Construction Update for the Goose Project in Nunavut, Canada (dated June 23, 2023)
For a more detailed overview of the Back River Gold District, please refer to the following most recent company documents:
- Click here for B2Gold’s Q1 2024 Management Discussion & Analysis (“MD&A”) (dated March 31, 2024)
- Click here for B2Gold’s Q1 2024 Financial Statements (dated March 31, 2024)
- Click here for B2Gold’s 2024 Annual Information Form (dated March 14, 2024)
