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A P R I L / M A Y 2 0 1 7 www.resourceworld.com 7 "Interestingly, a lot of our designs have come from Fort Knox – Kinross's large mine in Alaska," said McConnell. "They started out with not stacking ore on the pad for the 90 coldest days of the year and we've implemented that. However, in the last three years, they've managed to stack year round, so we also hope to do that at some point because it adds about $60 million of free cash flow to the project per year. Technically it's pretty straight forward as long as you apply a lot of discipline." McConnell noted that operating costs are projected to be about $11.70 per tonne moved. "Or if you translate it, less than $550 per ounce of gold, making for attrac- tive margins," he said. The power line extension and the min- ing fleet are included the Feasibility Study. Except for gold, there are not significant quantities of other metals in the Eagle deposit but there are in the surrounding area. "There's a tungsten deposit and high- grade silver in the area, so once we get Eagle up and running, we'll look at all of those other metals and perhaps there'll be a sec- ond mine there," speculated McConnell, "but with the amount of gold we see we'll be mining that out for a long time to come." Total ore reserves (Eagle, Olive, ROM) stand at 123 million tonnes grading 0.67 g/t gold, for 2.66 million ounces. The pro- posed mining rate will be 33,700 tonnes/ day, or 12.3 million tonnes/year. Strip ratio is a favourable 0.95:1 (waste:ore). After- tax payback is only 2.8 years. Estimated gold production would be approximately 200,000 ounces per year. All-in sustaining costs are US $638/oz. Post-tax NPV (@5% discount) is CDN $508 million with an after-tax IRR of 29.5%. Victoria Gold has built a 100-person construction camp on site and maintains the existing access road. Another 110-per- son all-season camp has been purchased and is ready to ship to the site. "We spent a lot of money on exploration and environmental work. I think our total expenditures since 2009 are over $100 mil- lion," said McConnell. The mine life can be extended as the Eagle deposit is open at depth. In addi- tion, the company has identified over 16 km of a mineralized trend and found over 12 targets by geochemical and geophysical surveys. "The first target we looked at was the Olive-Shamrock Zone," said McConnell. "We think there's potential there for 500,000 to a million ounces of gold, so that would extend the mine life another five years, or we could increase the production rate." The Eagle deposit hosts sheeted veins in a granodiorite. "It's not a porphyry deposit but is similar in that there is very even distribution of values across the deposit," said McConnell. The operating mine will employ roughly 400 workers. "There will be 200 on site on any one time as a rotating work crew. People will work two to three weeks in and two off," McConnell said. Victoria Gold has an agreement with First Nations. "My team and I have worked in Canada's north for many years and we understand the importance of working with the First Nations. So back in 2011, we signed a comprehensive benefits agreement with the local First Nation," said McConnell. "It's a good agreement for us and a good agreement for the First Nation." "I would say the permitting system in the Yukon is reasonable," said McConnell. "We've had great support from the govern- ment. The system could be improved but in general it works pretty well." "We're optimistic we'll start mine construction this summer depend- ing on continued market support," said McConnell. Mine construction is expected to take about one year. Key shareholders of Victoria Gold include Kinross Gold, Sun Valley Gold LLC and Electrum Group LLC. Victoria Gold has no debt. n FAR LEFT: The spectacular aurora borealis, or northern lights, shine down on the Victoria Gold camp where the company is preparing to build the Eagle heap leach, open pit gold mine. Photos courtesy Victoria Gold Corp. LEFT: John McConnell, President and CEO of Victoria Gold, left, with a colleague, look out over the Dublin Gulch property in Yukon where the Eagle Gold Mine will be built.