Goldquest Mining Corp is developing the Romero copper/gold project in the Dominican Republic
James West: Bill, tell us all about what Goldquest is up to.
Bill Fisher: Goldquest is in the Dominican Republic, which is a very nice place to be, and we’re trying to find the gold that Johnny Depp didn’t find. It’s a pretty easy place to work. I’ve been going there since 2000. There was another company, we sold the copper mine there, myself and my partner, Julio Espaillat, who’s a Dominican mining engineer, in 2008. And in 2012, Goldquest found a brand new discovery in the western part of the island in an area that was basically unknown for gold, and we found we could now convert it into about 3.2 million ounces of gold equivalent. Most of that is gold, and about 30 per cent is copper. And now we’re on the verge of completing a pre-feasibility study just over three years later, so it’s one of the quickest ones that’s been done ever, really.
James West: Yeah, wow, that’s fast.
Bill Fisher: Yeah. So we’re moving pretty quickly. The drilling in this deposit was the best drilling ever achieved in the Caribbean in history; the best drill hole was 235 metres of 7.9 grams gold and 1.4 per cent copper, and the nice thing about that was, that was true width, that wasn’t just shooting down a vein, that is the width of the deposit. So it’s got a really nice high grade core, and a lot of ounces surrounding it. So it’s a really nice discovery. It doesn’t come to surface; we found it through IP geophysics. So we’re very pleased to have actually made a – it’s probably one of the largest discoveries by a junior in the last five years anywhere in the world, so we’re very proud of that, or proud of our geologists, who did the actual work.
Andrew Krystal: Andrew here. Can we talk about the Dominican? Let’s talk about the mine.
Bill Fisher: The Dominican – so I’ve been going there for a long time. It’s bigger than Scotland, smaller than England, it’s a big place. Nine million people live there, so it’s not just a small island. The economic miracle has been driven a lot by the tourism. They’ve been growing at 5.4 per cent per year for the last 17 years in a row, that’s the average, so they’ve grown very well, but from a very low start, let’s be honest. And the biggest dividend they’ve had recently is Pueblo Viejo. Pueblo Viejo is a big gold mine; it’s the second biggest gold mine in the Americas, which is being run by Barrick and Goldcorp joint venture, and that’s producing, oh, I think it’s 1.3 million ounces a year at the moment. It’s the biggest investment in the Caribbean after the Panama Canal. So that’s going ahead, so that’s making a big dividend to the country.
And the advantage of where our project is in the west side of the country, it’s a very poor part, away from the tourist areas, right in the middle of the island, about 50 km from the Haitian border. So this area really needs the jobs. So we’re very pleased.
James West: Yeah. So what’s the access and infrastructure like in terms of that side of the island? Is there Hydro, is there power, are there roads?
Bill Fisher: Yup. We have, within 20 km of the project, there’s a tar road. 40 km away is the San Juan city, which is 150,000 people, which is the sort of southwest regional central city. Two universities, central hospital, supermarkets, everything you need. The last 20 km is up into the mountains; so we’re about 3,000 feet, or 1,000 metres elevation. The last 20 km, we have to fix up the road, which is all in the pre-feasibility budget, about $10 million to fix the road.
So we can get right to site. Just downstream of the area, there’s a big hydroelectric dam, which is where the national grid stops. So we’ll be grid connected, but because we’re at 1,000 m elevation, we’ll eventually use hydroelectric that will cut our electricity costs from $0.19 a kilowatt to $0.035 a kilowatt. But the key on this one is to get yourself into production as cheaply as possible and all the bells and whistles and sophistication will come later, but the first thing, get yourself into production.
James West: You bet. So what’s the timeline, do you think, until that happens?
Bill Fisher: Well, we put the mining permit application in last October; my hope is to get sometime this year, hopefully in the middle of the year, the mining permit, and that gives you a 75-year lease, which is very good security in the DR to say the least. Then upon the pre-feasibility study, we’ll translate that into Spanish, and that will be the basis of our environmental application. So the mining license gives you the right to mine there and the environmental permit lets you pour concrete and put up steel. So we’re waiting for the mining permit, and then the environmental permit goes in. The last mine that we built that was a greenfield mine in the DR, it took less than a year to get that permit. So we hope to be looking to be permitted within 2017.
Andrew Krystal: What about deposit projections?
Bill Fisher: The projections, what we’ve done – well, we’ve got what we call Mine #1, which is basically the central, the very high grade core that’s over 200m thick top to bottom, is a copper/gold, and then the outer parts of it going away from the central core, the copper stops and the gold continues. So the middle core, it’s 7.7 million tonnes out of a total indicated resource of 19.5 million tonnes and an inferred resource behind another 10 million tonnes. So we’re really only contemplating the first 25 per cent of the full resource. That’s a 10-year mine life. We’ll be looking to produce, in the best years, up to 150,000 ounces of gold equivalent, and the costs – now that’s Years two, three, and four, and those years, the all-in sustaining cost per ounce is $572 an ounce, and the cash costs are $400 an ounce.
James West: Huh! That’s very cheap.
Bill Fisher: It’s very cheap. The reason is because the high-grade core is like a big blob of sulphide mineralization, the stokes are going to be 15m wide by 20m high by 50m long, so they’re big, big stokes, so your cost per tonne comes tumbling down. And the average grade of that first 10-year mine plan is 5.4 grams of gold equivalent, so that brings your mining costs right down per ounce.
Bill Fisher: There is some blue sky. We put one of the holes in, on the outer peripheral of the central core, there is some inferred resource. We put a hole in that and the average grade was about four grams of gold and I think 0.6 copper, and we got 44m of 7.9 grams gold and 1.4 per cent copper. So that will increase over that part of the ore body.
I believe that we’ll find extension in all directions, but probably not too much. But having said that, the key to this deposit is, this is like a volcanogenic mass of sulphide, typically formed on the sea floor. But this didn’t get to the sea floor; this was, the hot fluids came up carrying gold and copper, and they hit the porous horizon, i.e. rubbly volcanic full of core seawater, and therefore it cooled down very slowly. That’s why it’s so big top to bottom. So it’s a similar thing. And these things come in clusters. So before the discovery of Romero in 2012, there was no belt over here and so now we’re looking at the whole 50 km length that we have, and we’ve found other hydrothermal plumes, this is where these sulphides come pouring up through these volcanics, and we rather hope that this may be…I suspect that this will probably top out at 5 million ounces or something.
James West: That’s respectable.
Bill Fisher: Yeah, I think it is, but I suspect there may be a series of other ones, like a string of pearls along the boundary. Because it is where the Atlantic plate hit the Caribbean plate, this is the volcanic sequence reflecting the collision of the two plates, which is why they come in a string.