US Gold is pursuing project financing for its fully permitted CK Gold project near Cheyenne, Wyoming, the company said in an investor presentation. The initial cost estimate for the project is US$400m.
Management has received indicative term sheets and is evaluating several options including debt, equity and offtake-related financing. Potential buyers have shown interest in securing concentrate supply and while management is not eager to place a stream on its copper and gold production, the project’s silver could potentially be part of a financing structure. Construction on the mine has been paused until the company finalises the financing plan.
US Gold has completed access road work and said the project shovel-ready. The most recent feasibility study shows an initial reserve pit containing 1m troy ounces of gold reserves and 260m pounds of copper, or 1.6m gold-equivalent ounces. The mine will operate for 10 years, processing 20,000 tonnes of ore per day. US Gold expects average production of more than 85,000 gold-equivalent ounces annually over the mine life, with production exceeding 100,000 gold ounces in each of the first three years, in addition to copper output.
The company has funded itself primarily through offerings, including non-brokered financings supported by a core shareholder group. It has 16.5m shares outstanding, 2.8m warrants and US$30m in cash.
US Gold also highlighted plans to refocus on exploration at its Keystone project in Nevada and Chalice project in Idaho.