AEX Gold Inc plans to speed up exploration programme at Nalunaq Project
“We have the premier land package in South Greenland and this exploration activity coincides with the rapidly growing interest the region is experiencing in the global scramble for strategic minerals”
Inc () () said it is working towards de-risking the Nalunaq Project as much as possible and increase the scale and value of the resource.
Once it will complete the feasibility level engineering study and incorporated the updated resource model, the miner will proceed directly with the revised development plan for Nalunaq.
WATCH: AEX Gold present strategic update to shareholders and full year financial results
“Nalunaq remains one of the highest-grade gold projects in the world,” said chief executive Eldur Olafsson in a release.
“This year we will be accelerating our exploration programme to better quantify the resource potential across our large licence portfolio. We have the premier land package in South Greenland and this exploration activity coincides with the rapidly growing interest the region is experiencing in the global scramble for strategic minerals.”
A peer review of the project conducted by Ausenco Engineering Canada Inc has identified scope for project capital cost optimisation and de-risking.
An internal third party engineering study is due to start imminently, so it can advance the project cost and schedule to a feasibility level of understanding, with planned completion later this year.
The AIM-listed firm reckons there is potential for significant expansion and de-risking of through a fully-funded 20,000-30,000 metres drilling campaign in 2021.
AEX has a current cash balance of C$54mln (£31mln).
The exploration and limited infrastructure ‘early works’ programme is estimated to cost C$10mln (£6mln), with another C$10mln to be paid for the taking delivery of long lead items already procured for Nalunaq and engineering costs to date.
Based on the existing development concept, AEX said it expects that significant additional capital, including an equity component would be required to bring Nalunaq into production.
However, feasibility level information from the engineering study combined with an updated resource model will allow for the optimisation of the forward development plan, including alternative funding avenues in order to minimise shareholder dilution, it added.
In the year to 31 December, exploration and evaluation expenses totalled C$7mln (£4mln), with net loss of C$12mln (£7mln).
In a separate announcement, the firm announced that Jaco Crouse has been appointed as a director to the board, replacing Robert Ménard who has chosen to step down from his position after four years.
Crouse is currently chief financial officer for AEX following his appointment in January 2021, and will remain in this role.
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