Drilling at Amex Exploration’s Perron Gold project.SUPPLIED
Having infrastructure in place is critical to start a mine, from local services and transportation networks to a stable of workers and a community that supports the project.
For Amex Exploration Inc., the Perron Gold project outside of Normétal, Quebec, has all of that and more. The public gold exploration company’s positive drilling results, the available infrastructure and its location in the so-called Abitibi region of northwestern Quebec, which has a long history of mining, are all important factors as the project moves forward.
“You have roads, you have electricity, you have water, you have manpower in the area, and it’s also a former mining town,” says Victor Cantore, president and CEO of Amex, which is headquartered in Montreal. “It dramatically changes the economics of a project to have this kind of support, versus finding a discovery that’s hundreds of kilometres away from everything.”
The local infrastructure will ensure the project can be made into a mine at a lower capital expenditure than more remote locations, he says. After almost 400,000 metres of drilling, Amex is set to release a resource calculation in late March, followed by a preliminary economic assessment (PEA) outlining the viability of its claims covering 4,560 hectares. This is expected to show the positive impact of the existing services that surround the project and the benefits of having it in Canada.
These factors separate the Perron project from many others, Mr. Cantore says. Amex has been involved in the property since the late 1990s and has had success with discoveries along the way. At one point, it attracted funding from Agnico Eagle Mines Ltd. to advance the exploration work, he says, and after additional raises in 2017, it started producing particularly high-grade results. “It’s looking like it’s going to become a world-class project,” he remarks, including both bulk tonnage and high-grade gold style mineralization.
Analysis of core samples at Amex Exploration’s Perron Gold project.SUPPLIED
Mr. Cantore notes that the town of Normétal had a mine right in it from the 1920s to the 1970s, with a population of more than 4,000 when that was in full operation. Today, it has about 700 people, while La Sarre, about 25 minutes to the south, has about 7,500 residents and Rouyn-Noranda, about an hour beyond that, has more than 40,000 residents. The Perron Gold property is just 22 kilometres from the La Sarre Airport, and there’s also an airport at Rouyn-Noranda.
Mr. Cantore says there’s an electrical power station a couple of kilometres from Perron, which supplies Normétal. “Having electricity dramatically decreases your exploration costs, and it makes the economics of the project a lot more attractive and viable.”
It is also close to a number of major gold producers’ milling operations. This provides an option for so-called “toll milling,” where a mine can send its ore to be processed. “But if your project gets big enough, then it becomes a standalone mine,” Mr. Cantore points out. The resource calculation and PEA will show different scenarios that could include toll milling or hybrid options, he says, “where you toll mill for the first couple of years while you’re building your facility.”
A recent announcement by Eldorado Gold Corp. that it will make a strategic $15-million investment in the company, representing a 9.9 per cent ownership, “is a clear validation of the work that Amex has done to date on the project,” Mr. Cantore comments. Eldorado is a high-grade, low-cost producer in the Abitibi region, he notes, “and Amex looks to benefit from their expertise and knowledge at this stage of our development.” The investment also leaves Amex well capitalized to pursue a dual strategy of advancing known zones of gold mineralization while continuing to unlock significant exploration potential through new drilling efforts. “There’s still a lot more potential for discoveries on this project,” Mr. Cantore says. “You want to advance development and at the same time continue forward with exploration, so you can keep expanding the resource.”
Quebec is a mining-friendly jurisdiction, and for people in the local community, the project means “you’re looking at very good and very well-paying jobs,” he says, with ever-wider benefits for the area. “These jobs can have a generational impact, and then there’s all the additional offshoots like stores, restaurants and other businesses.”
Amex Exploration’s Perron Gold project is yielding positive results including visible signs of gold.SUPPLIED
The company works hard at being a responsible corporate citizen, Mr. Cantore says. “You want to be a good neighbour, and it’s important that you get the proper social acceptability.”
Amex is committed to sustainably exploring for gold in a manner that minimizes the impact on the environment, demonstrates proper stewardship of the land and “respects and contributes to the local community where we operate,” Mr. Cantore states. “Our aim is to share the benefits of our operations and leave a lasting, positive legacy.”
There have been challenges; for example, the area was hit by the forest fires that burned across large parts of northern Quebec last summer. Normétal was completely evacuated and drilling stopped for about six weeks, but the town and the electrical power station were saved, and things quickly came back to normal. No Amex facilities or equipment were damaged by the fires, he says, and the response of the community to the blazes is testament to the infrastructure in place to deal with such emergencies.
Amex will continue drilling even as mines are developed at Perron. Most of the gold that has been found is in faults in a four-kilometre section of the Perron property, Mr. Cantore says, while more than 20 kilometres of additional faults there remain largely unexplored.
With gold expected to be a strong performer in 2024, “we hope the timing of our news will greatly benefit company shareholders in the coming year,” he adds. “We feel we have only scratched the surface of the gold potential at Perron.”
Produced by Randall Anthony Communications with the Prospectors & Developers Association of Canada. The Globe’s Editorial Department was not involved.