October 17, 2024 – US Gold Corp (NASDAQ: USAU) has made significant progress in advancing its flagship CK Gold Project in Wyoming by conducting engineering optimization studies to improve the project’s economics. After acquiring critical permits earlier this year, the company is now focusing on refining operational efficiencies to take advantage of surging gold, copper, and silver prices, which are approaching historic highs.
These engineering efforts, along with updates to the project’s pre-feasibility study (PFS), demonstrate US Gold Corp’s strategic plan to position the CK Gold Project for long-term profitability and sustainability.
Permitting Progress and Pre-Feasibility Update
US Gold Corp secured a Mine Operating Permit from the Wyoming Department of Environmental Quality (WDEQ) in May 2024, which allows the company to begin site preparation and construction. With this regulatory milestone in place, the company resumed revisions of its December 2021 PFS in June 2024. These revisions include updates based on permit requirements, engineering optimizations, and rising commodity prices.
“The time to make changes to a project is during the initial engineering phase so that the Feasibility Study is well-thought-out and durable,” said George Bee, US Gold Corp’s President and CEO. “Nothing disrupts project controls and cost management more than change orders once construction has started.”
Bee highlighted the importance of using this period to enhance the project’s technical framework before finalizing production decisions, ensuring a well-engineered operation that can endure future market conditions.
Tailings and Water Management Overhaul
A major component of the current optimization studies is the Tailings Management Facility (TMF). US Gold Corp has hired Denver-based Tierra Group International (TGI) to reassess the TMF design, aiming to increase efficiency while reducing capital costs. One significant change involves replacing the originally planned modified soil liner with a membrane composite liner, which offers greater durability without changing the facility’s footprint.
Water management is also a critical area for improvement. After receiving a water discharge permit in June 2024, US Gold Corp tasked TGI with updating the site-wide water balance model. This update aims to reduce the need for external water purchases by improving on-site water harvesting capabilities.
Although US Gold Corp has already secured a water supply agreement with the Cheyenne Board of Public Utilities, enhanced internal water management could significantly reduce costs and improve operational sustainability.
Process Plant Optimization for Higher Recovery Rates
US Gold Corp is also exploring alternative flotation technologies to optimize the CK Gold Project’s processing plant. The original PFS outlined a 20,000-ton-per-day sulfide concentrator, but advances in flotation technology since 2021 have led to a reevaluation.
Specifically, the company is examining Jameson Cells and IsaMill technology, which offer the potential for higher metal recovery rates, reduced energy consumption, and lower capital costs by shrinking the plant’s footprint. Test results from 150 kilograms of ore-grade material will determine whether these technologies can boost operational efficiency.
Unlocking Additional Revenue Potential
Along with gold and copper extraction, US Gold Corp is investigating opportunities to commercialize the granodiorite waste rock that will be excavated during mining. This material, suitable for infrastructure projects like rail ballasts and road construction, could generate an additional revenue stream. Nearby quarries sell similar material for $20-$25 per ton, positioning US Gold Corp to benefit from this market.
Luke Norman, US Gold Corp’s Chairman, emphasized the importance of this potential revenue stream: “The commercialization of waste rock not only strengthens our economic framework but also provides additional royalty payments to the state.”
The company is also considering using the exhausted pit for water storage, which could deliver long-term environmental and economic benefits, especially in the nearby Curt Gowdy Park, where city reservoirs are located.
Strong Economics and Expansion Potential
The CK Gold Project’s 2021 PFS estimated reserves of 1 million ounces of gold and 248 million pounds of copper, with an all-in sustaining cost (AISC) of $800 per ounce of gold. While these estimates were based on conservative price assumptions, the ongoing surge in commodity prices could further improve the project’s economic outlook.
Additionally, there is significant potential for resource expansion. Historical drilling suggests the mineralization extends beyond current boundaries, potentially doubling the resource. This untapped potential adds even more upside to the project’s already promising economics.
Looking Ahead
US Gold Corp is set to complete its engineering optimization studies and finalize the updated PFS later this year, with a full Feasibility Study expected by early 2025. As the company refines its operational plans and prepares for production, the CK Gold Project is poised to become a key player in Wyoming’s mining industry.
With most necessary permits secured and ongoing efforts to improve efficiency, US Gold Corp is well-positioned to advance the CK Gold Project toward full-scale development, while keeping sustainability and long-term profitability at the forefront.
