June 2013    Print this article

The Canadian Malartic mine in the southern part of the Abitibi Belt, Québec, Canada: discovery and development of an Archean bulk tonnage gold deposit

Robert Wares, Hon. D.Sc., P. Geo., Chief Geologist, and Sylvie Prud’homme,
B.Sc., P. Geo., Director of Investor Relations
Osisko Mining Corporation

The Canadian Malartic mine of Osisko Mining Corporation is located immediately south of the prolific Cadillac–Larder Lake Fault Zone in the southern part of the Abitibi Greenstone Belt which has produced more than one hundred million ounces of gold since the 1920s. The Canadian Malartic project started in October 2004 with the acquisition, from the liquidator trustee of McWatters Mining, of an initial block of claims covering the site of the former Canadian Malartic mine, an underground operation that produced approximately one million ounces of gold from 1935 to 1965. At the time, most mining companies considered the site to be completely stripped of its potential and in need of environmental rehabilitation, and nothing more.

In 2004, Osisko Exploration Ltd was a junior exploration company with only three full-time employees and a market cap below $5 million. The success of the company can be attributed, above all, to its innovative strategy: discover and define a bulk tonnage, low-grade, open pit mineable gold deposit by applying an unconventional geological model to the Abitibi region, namely an Archean porphyry gold deposit model. Since early 2004, Osisko concentrated its efforts on the Québec part of the Archean Superior Province. Compilation work focused on public data, most of which were extracted from the Québec government’s online geoscience database (SIGEOM), and was used to find areas with characteristics of gold porphyry systems. The research identified the former Canadian Malartic mine site as a high-priority target. Moreover, upon acquiring the initial claim block, Osisko gained access to a valuable unpublished paper database, which documented the historical operations at the Canadian Malartic mine as well as more recent exploration programs carried out on the property, particularly during the 1980s when Lac Minerals Ltd attempted to define a small resource inventory at shallow depth, mineable by open pit. The digitization, compilation and analysis of this vast database over the next four months, including more than 4,500 logs for surface and underground drill holes, allowed Osisko to refine the geological model for the property and confirm the potential for a bulk tonnage deposit.

The decision to proceed with the project was not easy, even in the face of successful exploration and resource definition phases, because the construction and eventual operation of an open pit mine next to the Town of Malartic would necessitate relocating the entire southern neighbourhood. As a result, right from the start, the project was received with a lot of skepticism from the Abitibi mining community for both economic and social reasons.

Seven years after acquiring the initial claim block, drilling more than 750,000 metres, filing a positive feasibility study in November 2008, obtaining a governmental order-in-council authorizing the project in August 2009, and raising a billion dollars in financing, the construction and start up of the Canadian Malartic open pit gold mine were completed. Commercial production, at 60% of nameplate capacity, was reached in May 2011 and has increased gradually since then. The throughput design capacity of 55,000 tonnes per day should be attained by the end of the second quarter in 2013, allowing the mine to produce 450,000 to 600,000 ounces of gold per year, making it one of the biggest gold mines in Canada. Proven and probable reserves (at US$1,200 per ounce) presently stand at 10.7 million ounces of gold (343.7 Mt @ 0.97 g/t Au), which are included in the NI 43-101-compliant global in situ measured and indicated resource estimate of 11.80 million ounces of gold (352.7 Mt @ 1.04 g/t Au), effectively cementing Canadian Malartic’s position as a deposit of world class calibre.

The history of the Canadian Malartic project is a perfect example of how applying modern empirical metallogenic models to already mined areas, and even using their old databases, can lead to success and world class discoveries.

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