Our Assets

Gold Resources

Resource estimates for our main gold projects (June 2020)

Projects

Beaufor Mine

Over 1.1 million ounces of gold produced and strong exploration potential

Monarch holds a 100% interest in the Beaufor Mine, which includes two mining leases, a mining concession and 23 mining claims covering an area of 5.9 km2. The mine is located at about 20 kilometres northeast of the town of Val-d’Or, in the Abitibi-East township, in the Province of Quebec. The Beaufor Mine is an underground mine.

On June 27, 2019, production activities at the Beaufor Mine have been temporarily suspended and the mine was placed on care and maintenance.

On May 7, 2020, Monarch announced that it has signed an agreement with Caisse de dépôt et placement du Québec to sell a 3% net smelter return royalty on gold production at the Beaufor Mine for $5 million.

42,500-metre drilling program

The planned exploration program will be one of the largest exploration programs ever undertaken on the Beaufor property, consisting of approximately 270 drill holes for a total of 42,500 metres (see Beaufor Presentation). Exploration drilling will be done in several phases, including:

  • Underground work in proximity to the exploration targets of the mine (high-grade intervals and isolated resource blocks)
  • Near-surface and mine targets
  • Targets below the current mine workings
  • Regional exploration targets
Underground work in proximity to the exploration targets of the mine

This initial phase, representing the bulk of the exploration drilling, will focus on the underground near-mine targets defined by the recent 3D modelling (see Figure 1). These holes will test areas near historical high-grade drill intersections and areas associated with known vein structures that remain open. These targets are all defined by high-grade intersections located near the existing underground infrastructure, thus requiring minimal development for mining purposes. They are also all located above the mine’s lowest development level (above 900 metres). These targets can easily be tested from the available underground workings, with the majority of the holes less than 200 metres long.

The second type of target related to underground near-mine targets will be the follow-up of isolated resource blocks that still have significant room for expansion. These resource blocks are typically defined by a single drill hole along a known mineralized structure, but continuity has not been demonstrated due to a lack of nearby drilling.

Near-surface and mine targets

The second type of target related to underground near-mine targets will be the follow-up of isolated resource blocks that still have significant room for expansion. These resource blocks are typically defined by a single drill hole along a known mineralized structure, but continuity has not been demonstrated due to a lack of nearby drilling.

Targets below the current mine workings

A program of exploration drilling of the area below the current mine workings (below 900 metres) will be undertaken to continue testing the extension of the known mineralization at depth, where mining left off prior to the temporary shutdown (see Figure 3). Recent wide-spaced drilling below the bottom of the mine has confirmed the extension of the mineralization. The planned drilling will target specific areas defined by previous high-grade intersections in an area extending down to 230 metres below the current workings.  

Regional exploration targets

The final phase of the exploration drilling will consist of surface drill holes to test regional targets defined by historical intersections and potential structures beyond the current limits of the underground infrastructure (see Figure 4).

Reserves

Table of estimated mineral reserves
Notes
  • The independent and qualified person for the mineral reserve estimate, as defined by NI 43-101 is Laurent Roy, Eng. (OIQ No. 109779), of InnovExplo Inc. The effective date of the estimate is September 30, 2017.
  • The economic viability of the mineral reserve is proven.
  • Results are presented including dilution. Dilution varies from 10% to 15% for the long-hole stopes based on the position of the dyke, and is 0% for the room-and-pillar stopes as the stope width is less than 2.40m.
  • Results are presented including mining recovery rates. Mining recovery varies from 85% to 90% for long-hole stopes based on the position of the dyke and is 90% for room-and-pillar stopes.
  • The metallurgical gold recovery at the Camflo mill is 98%.
  • The mineral reserve was compiled using cut-off grades of 3.95 g/t Au (long-hole) to 4.66 g/t Au (room-and-pillar). Cut-off grades must be re-evaluated in light of prevailing market conditions (gold price, exchange rate and mining cost).
  • A constant specific gravity value of 2.75 t/m3 was used.
  • Ounce (troy) = metric tons x grade / 31.1035. Calculations used metric units (metres, tonnes, and g/t).
  • The mineral reserve was estimated using a long-term gold price of CAD 1,638.40 per ounce (metal price of USD 1,280 per ounce and an exchange rate 1.28 CAD/1 USD).
  • Tonnage and ounces estimates were rounded to the nearest hundred. Any discrepancies in the totals are due to rounding effects; rounding followed the recommendations in Form 43-101F1.
  • The mineral reserve estimate is compliant with CIM standards and guidelines.
  • InnovExplo is not aware of any known environmental, permitting, legal, title-related, taxation, socio-political, marketing, or other relevant issue that could materially affect the mineral reserve estimate.

Resources

Estimated mineral resource table, exclusive of mineral reserve
Notes
  • The independent and qualified person (“QP”) for the Mineral Resource Estimate as required by NI 43101 is Carl Pelletier, P.Geo. (OGQ 384), employee of InnovExplo Inc. The effective date of the estimate is September 30, 2017.
  • Mineral resources which are not mineral reserves do not have demonstrated economic viability.
  • Mineral reserves have been subtracted from mineral resources.
  • Results are presented in-situ and undiluted. The reported mineral resource is considered by the QP to have reasonable prospects for underground economic extraction.
  • The estimate includes 63 mineralized zones in the Beaufor mine.
  • Mineral Resources are estimated at variable cut-off grades ranging from 3.95 g/t Au (long-hole) to 4.66 g/t Au (room-and-pillar). Cut-off grades must be re-evaluated in light of prevailing market conditions (gold price, exchange rate and mining cost).
  • A specific gravity value of 2.75 t/m3 was used.
  • A minimum true vein width of 2.40 m was used.
  • Capping of high-grade values was done at 68.5 g/t Au for zones 8, B, M, M1 and Q, while all other zones were capped at 34.25 g/t Au and drill hole intersections were capped at 16.5 g/t over 2.40 m. Capping was done on raw assays.
  • The estimation method was polygonal on cross section.
  • Polygons for measured resources extend 8 m above and below development and up to 10 m laterally. Polygons for indicated resources do not extend more than 20 m from drill hole intercepts, along dip and along strike. Polygons for inferred resources do not extend more than 40 m from drill hole intercepts, along dip and along strike; they are generated where the drill spacing generally ranges from 20 m to 40 m and/or in areas of isolated drill holes where mineralization is interpreted to be the extension of known mineralized zones.
  • Ounce (troy) = metric tons x grade / 31.1035. Calculations used metric units (metres, tonnes, g/t)
  • Mineral Resources are estimated using a long-term gold price of CAD 1,638.40 per ounce (metal price of USD 1,280 per ounce and an exchange rate of 1.28 CAD/1 USD).
  • Tonnage and ounce estimates were rounded to the nearest hundred. Any discrepancies in the totals are due to rounding effects; rounding followed the recommendations in Form 43-101F1.
  • CIM definitions and guidelines were followed in estimating mineral resources.
  • InnovExplo is not aware of any known environmental, permitting, legal, title-related, taxation, socio-political, marketing or other relevant issue that could materially affect the mineral resource estimate.

Geology

The Beaufor deposit is included in the Bourlamaque granodiorite. Gold mineralization occurs in veins associated with shear zones that moderately dip south. The mineralization is associated with quartz-tourmaline veins resulting from the filling of shear and extension fractures. The gold-bearing veins show a close association with mafic dykes intruding on and undercutting the granodiorite. The dykes seem to have influenced the structural control of the gold-bearing veins.

Mineralization

Gold-bearing veins at the Beaufor Mine consist of quartz-tourmaline-pyrite veins, typical of Archean epigenetic lode gold deposits, that cross-cut the Bourlamaque Batholith. Mafic dykes that predate the mineralization are associated with shear- hosted gold-bearing veins. Shallowly dipping extensional gold-bearing veins are commonly observed at the Beaufor Mine. Shear zones striking N70o and dipping steeply to the southwest control the opening and gold enrichment of veins.

All the gold-bearing veins are contained in a strongly-altered granodiorite in the form of chlorite-silica forming anastomosing corridors of 5 m to 30 m in thickness. The veins at the Beaufor Mine form sometimes panels of more than 300 m in length by 350 m in height. The thickness of the veins varies from 5 cm to 5 m, but generally, the thickness of the quartz veining system 30 cm to 120 cm. The zones are limited by the Beaufor fault (N115o/65o-75o) and by a parallel system of shears (N70o/sub vertical).

Croinor Gold

Advanced project at the prefeasibility stage

Monarch Gold holds a 100% interest in the Croinor Gold property, which consists of one mining lease and two non-contiguous blocks of claims for a total of 335 claims over a 151 km² area. The property is located approximately 55 km east of Val-d'Or (75 km by road) and 27 km east of Louvicourt, the nearest town.

Prefeasibility Study Highlights (January 2018)

  • Based on US$1,280 gold price and CA$1.28/US$1 exchange rate
  • Pre-tax IRR of 47.5%
  • Proven and probable reserves: 602,994 tonnes @ 6.66 g/t
  • Total production: 125,889 ounces of gold
  • Total cost per ounce: US$902
  • Mine life: 3.6 years (including preproduction)
  • Study does not include drilling results after November 2015
  • Excellent results from the 2018 26,580-metre drilling program, which may considerably improve the project’s potential

Sensitivity Analysis

Pre-tax NPV 5%
Pre-tax IRR

Reserves and resources estimation

* Source: Monarch prefeasibility study (January 19, 2018) and resources estimation (January 8, 2016).

Geology

The Croinor Gold property is located in the eastern part of the Archean Abitibi Greenstone Belt in the southern Superior Province of the Canadian Shield.The Abitibi Greenstone Belt is one of the most extensive continuous expanses of low metamorphic grade Archean volcanic and sedimentary rocks in the world.

The Croinor Gold property is underlain by two major lithological packages—the dominantly volcanic Assup Domain in the north and the dominantly sedimentary Garden Island Domain in the south. The Assup Domain is further divided into the mafic volcanic Aurora Group in the south and the mafic to intermediate volcanic Assup Group in the north (dominantly mafic). The Pershing Batholith overlaps the southwest end of the property. The Croinor Gold property is transected by the Garden Island Deformation Corridor in a northwest-southeast direction, which overprints and partially follows the contact between the Assup and Garden Island domains.

Mineralization

The Croinor Gold deposit is hosted by the synvolcanic Croinor Sill. This dioritic sill is from 60 to 120 m thick and hosted within volcanic rocks of the Assup Domain. The deposit is characterized by gold-rich lenses consisting of quartz-carbonate-tourmaline-pyrite veins, altered pyritic host rock material, and/or tectonic breccia (pyritic host fragments within a quartz-carbonate-tourmaline-pyrite vein).

The mineralized lenses range from 60 to 120 m long. The lenses can generally be followed from one section to another (10 m sections) over lateral distances varying from several tens of m up to 600 m. To date, about 40 gold-rich lenses have been identified.

Other Showings

Many other showings have been explored to a degree ranging from trenching to drilling.  In most cases, gold mineralization is found in vein systems within or associated with dyke, sill or pluton intrusives within the volcanics.

The known showings are Gold Bug, Croinor-Trench 2, Bug Lake, Pershon, Rocheleau-3, Rocheleau-5, T13, Kenda Pershing, Ansley, Onyx-Tavernier, Jolin and Brett-Tretheway.

McKenzie Break

High-grade gold deposit near Monarch’s mills

Monarch Gold acquired a 100% interest in the McKenzie Break property from Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM). The property hosts a high-grade gold deposit that lies just 20 kilometres north of the Beacon mill and 35 kilometres north of Val-d'Or, Quebec. It consists of 133 mineral claims covering a total area of 51.3 km2, and is accessible year-round via Route 397 and a gravel road. The property is also about nine kilometres south of the rail link between Barraute and Senneterre.

The McKenzie Break property is located in an area with existing infrastructure and several mills. It has surface and underground infrastructure, including a ramp down to a depth of 80 metres below surface.

Resource Estimation

On June 14, 2018, Monarch Gold reported the results of a mineral resource estimate for its McKenzie Break gold project. The report was prepared by Alain-Jean Beauregard, P.Geo., and Daniel Gaudreault, Eng., of Geologica Groupe-Conseil Inc., and Christian D’Amours, P.Geo., of GeoPointCom Inc., qualified persons as defined by NI 43-101. The estimate was prepared by GeoPointCom Inc. and is dated April 17, 2018.

The mineral resource estimate for McKenzie Break was prepared for two scenarios:

Scenario 1: A pit constrained Indicated resource of 48,133 ounces and Inferred resource of 14,897 ounces, and an underground Indicated resource of 53,448 ounces and Inferred resource of 49,130 ounces.

Scenario 2: An underground Indicated resource of 85,059 ounces and Inferred resource of 58,373 ounces.

Notes

  • CIM definitions for mineral resources were used.
  • Mineral resources were estimated at a cut-off grade of 0.52 g/t Au for the pit constrained resource and at a cut-off grade of 3.50 g/t Au for the underground resource.
  • Mineral resources were estimated using a 3-year average gold price of US $1,234.82 per ounce on the London market and an exchange rate of US $0.78 = C $1.00.
  • A minimum mining width of 2 metres was used.
  • A bulk density of 2.77 g/cm³ was used.
  • Numbers may not add due to rounding.

The main Green and Orange zones were drilled on a tight grid to define the resource. The mineralization consists of multiple, narrow and at times anastomosing high-grade veins. Assay results can be erratic due to the nugget effect of the gold.

The database contains conventional analytical gold assay results for 258 surface diamond drill holes, as well as coded lithology from the drill core logs (except for the Series WD04 and WD05 holes). This represents 39,611 m of core for a total of 14,758 m assayed core. The database does not include results for QA/QC samples. At least one of the mineralized zones or the potential pit mineralized material covered by the estimate was intersected in 244 of the holes. This represents 3,411 intersections (including 1,817 in the mineralized zone) for 56,141 composites (including 5,488 in the mineralized zone).

Swanson

Large gold property with open pit potential

Monarch acquired a 100% interest in the Swanson property from Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM). The property hosts a gold deposit located 65 kilometres from the Beacon mill and 12 kilometres northeast of Barraute, Quebec. It consists of one mineral lease and 129 claims covering a total area of ​​51.1 km2, as well as a 500-metre ramp down to a depth of 80 metres. The property is accessible year-round via Route 367 and a gravel road. A railway track also crosses the property, as does a transmission line.

Resource Estimation

On June 20, 2018, Monarch Gold reported the results of a mineral resource estimate for its Swanson gold project. The resource estimate was prepared by Christine Beausoleil, P.Geo. and Alain Carrier, P.Geo., M.Sc., of InnovExplo Inc., both qualified and independent persons as defined by NI 43-101. The effective date of the estimate is June 15, 2018.

The Swanson project mineral resource estimate for a potential scenario combining pit-constrained and underground resources at cut-off grades of 0.8 g/t Au (pit-constrained) and 2.7 g/t Au (underground) is summarized in the following table 1, whereas table 2 shows the sensitivity analysis of the Swanson maiden mineral resource estimate for the pit-constrained scenario.

Table 1 - Swanson Maiden Mineral Resource Estimate for a combined pit-constrained and underground scenario at a cut-off grade of 0.8 g/t Au (in pit) and 2.7 g/t Au (underground)

Notes to the mineral resource table:
  • These mineral resources are not mineral reserves, as they do not have demonstrated economic viability.
  • The 2014 CIM definitions and guidelines for mineral resources have been followed.
  • Results are presented in situ and undiluted and considered to have reasonable prospects for economic extraction.
  • The estimation encompasses four zones with a minimum true thickness of 2.5 m using the grade of the adjacent material when assayed, or a value of zero when not assayed.
  • A high-grade capping of 30 g/t Au (4 g/t Au for the dilution envelope) was applied to assay grades prior to compositing grade for interpolation using an Ordinary Kriging interpolation method, based on 1.5 m composite for block size of 3 m x 3 m x 3 m.
  • Bulk density values were applied on the following lithological basis (g/cm3): I2 = 2.78; I4O, V3, V4 = 2.90, and OVB = 1.5.
  • The number of metric tons was rounded to the nearest thousand and the metal contents are presented in troy ounces (tonne x grade / 31.10348).
  • InnovExplo is not aware of any known environmental, permitting, legal, title-related, taxation, socio-political or marketing issues, or any other relevant issue not reported in this Technical Report that could materially affect the mineral resource estimate.

Table 2 – Sensitivity analysis of the Swanson Maiden Mineral Resource Estimate for the pit-constrained scenario

The 2018 maiden mineral resource estimate was prepared using Leapfrog GEO and GEOVIA GEMS software. Leapfrog was used for 3D modelling of the four mineralized zones while GEMS was used for grade estimation and block modelling. Statistical studies were done using Snowden Supervisor and Microsoft Excel software. The estimate was performed using 3D block modelling with the Ordinary Kriging interpolation method.

The diamond drilling database contains the results of 146 surface and 63 underground drill holes provided by Monarch. Basic univariate statistics were performed on datasets of individual raw gold assays for each zone and for the dilution envelope. The capping (30 g/t Au) was applied on raw assays before compositing at 1.5 m.

The cut-off grades were calculated using a gold price of USD1,296/oz, a CAD:USD exchange rate of 1.28 and the following parameters: (a) pit-constrained scenario: mining cost CAD4.94/t, processing cost CAD27.00/t, General and administrative CAD4.00/t, pit slope of 50 degrees used during Whittle optimization; (b) underground scenario: mining cost CAD90.00/t, processing cost CAD27.00/t, General and administrative CAD10.00/t.

Gold Resources

Resource estimates for our main gold projects

Beacon Mill

Property Description

The Beacon Mill has a 750 tpd capacity. The mill is located on a property that consists of a mining lease, a mining concession, and 11 mining claims covering an area of 1.8 km2. The property also has tailings management ponds, underground installations, a 500-metre deep shaft and a mechanical shop. The plant is located in Val-d’Or on highway 117 and at proximity to the railroad at less than 500 m.

The Beacon Mill is fully permitted, including a certificate of authorization by the ministère du Développement durable, de l’Environnement et de la Lutte contre les changements climatiques for the processing of 1,800,000 tonnes of tailings, equivalent to approximately nine years of mineral processing at full capacity.