Allied Nevada Defers Hycroft Mill Construction

Allied Nevada announced in early August that it is deferring construction of a mill that would operate in parallel with its current heap leach operations at its Hycroft mine 54 miles west of Winnemucca, Nevada. The company will continue metallurgical test work to optimize the mill flowsheet, and when that work is complete, a revised, third-party feasibility study will be undertaken to assess how the mill project will be developed.

The company will continue to work on finalizing the environmental permits necessary to operate the mill.

As a result of the decision to defer mill construction and focus on optimizing the mill plan, Allied Nevada said it has not developed a revised time frame, scope, or capital cost for different mill scenarios or revised long-term projections and estimates of production. The company expects to make a decision on when mill construction will be resumed once a new feasibility study is completed.

Allied Nevada received approval in early December 2012 from the Nevada Department of Environmental Protection to construct a 130,000-st/d mill at Hycroft. Previous planning had targeted a mill startup in late 2014 and full operations during the first quarter of 2015.

Regarding eventual development of a milling operation at Hycroft, Allied Nevada President and CEO Randy Buffington said, “This is a world-class, multimillion-ounce, low-cost deposit located in the right jurisdiction, and I am confident that this is a project that will be built.”

Allied Nevada expects to continue mining existing Hycroft heap leach reserves of approximately 2 million oz of gold and 84.3 million oz of silver during the six-year period from the start of 2014. Assuming heap leach operations only, production during that time frame is expected to average 225,000 oz/y of gold and 2.7 million oz/y of silver.

Hycroft produced 39,195 oz of gold and 132,841 oz of silver in the second quarter of 2013. Allied Nevada’s full-year 2013 production guidance for Hycroft is currently 175,000 to 200,000 oz of gold and 900,000 to 1.1 million oz of silver.

As featured in Womp 2013 Vol 09 -