Resource World Magazine

40 www.resourceworld.com d e c e m b e r / j a n u a r y 2 0 1 6 idm mining [IDM-TSX] is actively working to advance a pro- posed 1,000 tonne-per-day underground gold mine at the Red Mountain gold project and has an option to earn a 100% inter- est in the 17,125-hectare property, located 15 km northeast of Stewart, northwest BC. The project plan, as envisioned by the latest Preliminary Economic Assessment, has a low capital cost ($76.1 million), low operating cost ($105.3/tonne), attractive after-tax NPV (5%) ($57.6 million), and a high after-tax IRR (32.9%). These econom- ics are based on a five-year mine life with an average head-grade of 7.25 g/t gold, producing 55,500 payable ounces gold per year. There is also the potential to double the strike length of the deposit and add resources in adjacent mineralized areas on the property. This could substantially prolong the mine life. IDM is led by Rob McLeod, a well-known and respected geolo- gist. He was the founder and VP Exploration of Underworld Resources, one of his more recent professional successes. Underworld was acquired by Kinross Gold for $140 million for its 1.4 million oz. White Gold deposit in the Yukon. Since the deal to acquire the Red Mountain property was announced in April 2014, IDM has been methodically working to complete its extensive "to-do list." The company has already completed extensive environmental baseline studies to support the Environmental Assessment (EA) process. Baseline studies have included: surface and groundwater quality, hydrology, cli- mate, geochemical studies, archeological assessments, geo-hazards assessments, and fisheries and wildlife studies. "IDM's focus for 2015 is to advance the necessary environ- mental baseline work, permitting and engineering of the Red Mountain Project to facilitate full regulatory approvals, and sup- port a potential positive investment decision in 2016," commented McLeod, President and CEO. This past summer, IDM submitted a Project Description to both the BC Environmental Assessment Office and the Canadian Environmental Assessment Agency. The Project Description was reviewed in advance by First Nations, who have been engaged in constructive dialogue with IDM. In addition, the community of Stewart has also been engaged. In early November, the BCEAO announced it had initiated the environmental assessment of the project. "The Project Description Report provides a concise overview of our proposed plans for the development of the project and allows us to meaningfully engage with govern- ment, the Nisga'a Nation and other communities in the region," stated McLeod. "Our vision for a proposed, high-grade gold mine with potential low operating costs and capex within a daily commute of my hometown of Stewart, would have a significant, positive impact on northwestern British Columbia." IDM intends to update the project's NI 43-101 resource esti- mate to include results from drilling in 2014 and historic results from the 141 Zone. This zone of mineralization runs parallel to the current resource zones. The aim will be to complete a NI 43-101 compliant Pre-Feasibility Study by mid-2016. The deposit was originally discovered by Bond Gold in 1989 and since that time has seen extensive exploration and devel- opment. In total, more than $40 million has been spent on the property by various operators, including Lac Minerals, Royal Oak, NAMC Engineering and Seabridge Gold. No significant exploration work has taken place since 1996. According to the Preliminary Economc Assessment that was prepared for IDM Mining in July 2014, by JDS Energy & Mining Ltd., the project demonstrates potential robust economics for an underground mine, with low capital ($76 million) and operating costs ($456/oz net of silver by-product) and a post-tax payback period of 1.5 years. The recent decline in the Canadian dollar would potentially result in even better economics, with the PEA base-case foreign exchange at $0.95 CAD: USD. The base-case PEA was based on a gold price of US $1,250/oz and a silver price of US $50/oz. The PEA was based on measured and indicated resources using a 3.0 g/t gold cutoff, from the Marc and AV Zones at Red Mountain. These currently tally to 1,454,300 tonnes averaging 8.15 g/t gold and 29.57 g/t silver (380,900 oz contained gold and 1,382,800 oz contained silver). Additional inferred resources from the Marc, AV and JW Zones weigh in at 332,900 tonnes averaging 7.69 g/t gold and 12.72 IDM Mining moving Red Mountain towards production by Thomas Schuster Channel sampling at the Cambria Zone at the Red Mountain gold project near Stewart in northwest British Columbia. Photo courtesy IDM Mining Ltd. mINING

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