Jean-Marc Lacoste
President and CEO 
1-888-994-4465 x 201
Mathieu Séguin, CFA
Vice President, Corporate Development
Elisabeth Tremblay 
Senior Geologist – Communications Specialist

The study shows improved project economics and an increase in reserves 


  • 10% increase in proven and probable reserves 
  • 16% decrease in average operating cost, to US $639 per ounce of gold 
  • 13% decrease in total costs, to US $902 per ounce of gold
  • Average annual gold production of 31,472 ounces over four years 
  • After-tax IRR of 30%
  • Project still has excellent exploration potential

Montreal, Quebec, Canada, February 8, 2018 – MONARQUES GOLD CORPORATION (“Monarques” or the “Corporation”) (TSX-V:MQR) (OTCMKTS:MRQRF) (FRANKFURT:MR7) is pleased to report the results of an updated prefeasibility study for its wholly-owned Croinor Gold property near Val-d’Or, Québec. The prefeasibility study was prepared by InnovExplo Inc. in conjunction with Amec Foster Wheeler and WSP Canada Inc.

Located near Route 117 (Trans-Canada Highway), the Croinor Gold property is accessible by gravel road, and has an access ramp and development shaft. In addition, the Val-d'Or mining camp is a recognized, world-class mining camp with a skilled workforce and high-quality infrastructure. These are all attributes that favour the development of the Croinor Gold mine.

The prefeasibility study presents an underground operation that produces ore to be processed at the Beacon mill. The project has an expected mine life of less than four years, including one year of pre-production. The study highlights are presented below, and the prefeasibility study itself will be filed on SEDAR in the coming weeks. Note that all amounts in this press release are in Canadian dollars unless otherwise indicated.


The prefeasibility study indicates that, at a gold price of US $1,280/oz and an exchange rate of CA $1.28/US $1,  the Croinor Gold mine could generate an after-tax net present value (“NPV”) of $18.3 million (using a 5% discount rate) and an after-tax internal rate of return (“IRR”) of 30%. The mine could produce an average of 31,472 ounces per year for the life of the mine, at an average operating cost of US $639/oz and an estimated total cost of US $902/oz.

Table of financial parameters

(1) Volume and grade account for dilution and ore recovery. 
(2) Includes approximately $17.2 million in sustaining capital.

“This updated prefeasibility study has significantly improved the profitability forecasts for the Croinor Gold project, as well as increasing the proven and probable reserves,” said Jean-Marc Lacoste, President and Chief Executive Officer of Monarques. “It is also important to note that the study did not include the results from the 25,645 metres of drilling done on and around Croinor Gold since November 2015. Based on the results received to date, it is clear that the project still has excellent exploration potential. Our goal for our future drilling programs is to extend the life of the Croinor Gold project by increasing the resource.”  


Mineral resource

The mineral resource estimate used in the prefeasibility study was published previously in a report titled “Technical Report and 2015 Mineral Resource Estimate Update for the Croinor Gold Property”, dated January 8, 2016 (Poirier et al., 2016 ).

At a cut-off grade of 4 g/t Au, the measured resource is 80,100 tonnes at 8.44 g/t Au, or 21,700 ounces, the indicated resource is 724,500 tonnes at 9.20 g/t Au, or 214,300 ounces, and the inferred resource is 160,800 tonnes at 7.42 g/t Au, or 38,400 ounces. Only the measured and indicated resource was used for the prefeasibility study.

Mineral reserves

Mineral reserves were classified in accordance with the CIM Definition Standards for Mineral Resources and Mineral Reserves. The mineral reserves for the project take into account the dilution and ore recovery associated with the selected mining method.

MSO (Mineable Shape Optimizer) software, a CAE Studio 5D software application, was used to determine the resources to be converted to reserves. The MSO software defines the mineral zones from the block model based on specified stope parameters, and the stope shapes are then optimized manually.

Two mining methods appear to be the best suited to the Croinor deposit: long hole, and room and pillar. Two MSO runs were done on the block model to select the most appropriate method, using the parameters shown below for the two methods. The manual stope design takes into account a minimum mining width of 1.8 m for the long-hole stopes and a mining height of 1.8 m for the room-and-pillar stopes. 

Design parameters for the long-hole mining method:

  • Cut-off grade: 4.42 g/t
  • Minimum mining width: 1.8 m (stope thickness) 
  • Mining dilution of 30% on the hanging wall (grade = 0 g/t) 
  • Minimum angle of the stope footwall: 43 degrees 
  • Sublevel interval of 15 m along dip

Design parameters for the room-and-pillar mining method:

  • Cut-off grade: 4.57 g/t
  • Minimum mining height: 1.8 m 
  • Mining dilution of 5% on the hanging wall (grade = 0 g/t) 
  • Maximum mining width: 3 m (stope thickness) 
  • Maximum stope angle of 45 degrees.

The estimated proven and probable reserves, as summarized in the following table, totals 129,292 ounces after applying the appropriate mining recovery and dilution factors for the method selected. 

Estimate of the diluted mineral reserves 

  • The independent qualified persons for the mineral reserve estimate, as defined by National Instrument 43-101, is Laurent Roy, Eng., OIQ #109779, of InnovExplo Inc. The effective date of the estimate is January 19, 2018.
  • The economic viability of the mineral reserves has been demonstrated. 
  • Results include dilution of 30% for the long-hole stopes, based on a minimum mining width of 1.8 m, and 5% dilution for the room-and-pillar stopes, based on a minimum mining working height of 1.8 m. 
  • Results reflect an ore recovery of 95% for the long-hole stopes (pillars left in place are not included in the estimate) and 85% for the room-and-pillar stopes.
  • Gold recovery at the Beacon mill is 97.5%.
  • The mineral reserves were compiled using cut-off grades of 4.42 g/t Au (long hole) and 4.57 g/t Au (room and pillar). The appropriate cut-off grade will vary depending on the economic context and the operating parameters determined. 
  • A density of 2.80 t/m3 was used.
  • Ounce (troy) = tonnes x grade / 31.1035. Calculations used metric units (metres, tonnes and g/t). 
  • The mineral reserves were estimated using a long-term gold price of CA $1,656.68 per ounce (gold price of US $1,252.21 per ounce and an exchange rate of CA $1.323 /US $1). 
  • Estimated tonnage and ounces were rounded to the nearest hundred. Any discrepancies in the totals are due to the effect of rounding; rounding followed the recommendations in Form 43-101F1. 
  • CIM guidance and definitions were followed in the preparation of this mineral reserve estimate.
  • 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.

Ore recovery and dilution 

The dilution and recovery factors applied in the mine plan and the reserve estimate are based on a geomechanical assessment of the rocks and the application of factors commonly used for the selected method.

For the long-hole method, the stopes and pillars were established manually based on the geomechanical assessment. A dilution factor of 30% at a grade of 0 g/t was applied for the long-hole stopes and a 95% recovery factor was then applied to the remaining tonnage.

For the room and pillar method, a 5% dilution factor was applied to the stopes, which were then evaluated using a recovery factor of 85%. 

Cut-off grade

Each stope that was close to the cut-off grade was evaluated individually to determine whether it should be included in the study or discarded. A metal price of US $1,252.21 at an exchange rate of CA $1.323/US $1 was used to calculate the cut-off grade. The remaining parameters used in the cut-off grade calculation are shown in the following table.

Cut-off grade parameters


The proposed mining plan for the Croinor Gold property covers underground mining of narrow subvertical veins. A large portion of the identified resources dip at less than 45 degrees, which is not favourable for long-hole mining, as the broken ore does not flow easily. 

The mining plan for the Croinor Gold property comprises a combination of conventional and mechanized mining. The approach in the study was to favour the long-hole mining method wherever possible. When the angle of the footwall was less than 43 degrees, room and pillar mining was selected. The mineralized zones were defined using MSO software and stope design was then done manually to optimize recovery. 

The ore will be transported to the surface using a combination of 3.5-yard and 6-yard scooptrams and 30-ton trucks. Waste material will either be brought to the surface or used to backfill mined-out stopes when possible. The deposit will be accessed via a ramp. The existing ramp will be restored to level 125 and a new section will be excavated to access all the reserves. The production drifts will be accessed via crosscuts connecting to the ramp. 

Existing mine infrastructure 

The Croinor deposit is serviced by a ramp measuring approximately 300 m long and 4 m high by 4.5 m wide extending to level 125 (38 m), and by a 195-m deep, three-compartment shaft. Development was driven on four levels: 496 m on level 125; 560 m on level 250; 233 m on level 375; and 730 m on level 500. Approximately 320 m of raise development was also done. The Croinor Gold mine is currently flooded to the portal entrance. 

Production schedule 

InnovExplo developed a preliminary development and production schedule that takes into account the existing underground workings. Mine operation is based on a production schedule of two 10-hour shifts per day, seven days per week. The underground mine is designed for mining over a period of nearly four years, including one year of pre-production, to produce 602,994 tonnes of ore grading 6.66 g/t. Using a mill recovery of 97.50%, this translates into 125,889 ounces of gold produced over the period.

The ore will be mined using the long-hole and room-and-pillar methods at a ratio of 62% to 16%, with the remaining 22% of the ore coming from development work. The mine plan includes all the development required to access and mine the mineralized zones. The following table shows the production schedule over the life of the mine.

Production schedule over the life of the mine (from the prefeasibility study) 

Processing and metallurgy

The ore mined at Croinor Gold will be processed at the Beacon mill in the Val-d'Or area, which will have excess capacity during the period that the Croinor Gold mine is in production. Ore mined previously from the Croinor open pit was processed at a local mill, and the actual results of that processing were used as a basis for the 97.50% gold recovery used in the current study.


A 25 kV power line will be installed between the former Chimo mine and the Croinor Gold property to supply electricity to the property. To reduce haulage distances, a new 8-km, grade 3 logging road will be built, using a bridge/culvert system to cross a 25-m wide river. The existing roads leading to the site and those on the site will need to be upgraded.

The mine will be dewatered and the 300 m ramp and approximately 720 m of the 2 km of drifts on the existing levels will be restored and extended to meet the mine’s needs. The current 195-m shaft will be rehabilitated and used as a ventilation raise and escapeway. The ore and waste will be hauled to surface via the ramp. One of the existing buildings will be outfitted for use as a warehouse, and other buildings will be built to serve as changing facilities, offices, garages and a core shack.

Environmental studies and permits 

The Corporation has a certificate of authorization for mine operation issued in September 2010 and a certificate of authorization for mill operation issued in February 2017. Other studies and permits relating to the environment, site restoration and the crown pillar, which are required for mine operation, have also been carried out or obtained. An authorization for mine dewatering and other accessory permits will be obtained when the project starts.

Various permits and authorizations will also be obtained for the transportation infrastructure, and compliance of plans and specifications with the fisheries protection provisions will be verified with the regulatory authorities if required.

Operating costs

Operating costs over the life of the mine are estimated at $817.91 per ounce. The following table shows the cost breakdown. 

Summary of total life-of-mine operating costs 

Capital costs

Pre-production costs are estimated at $33.53 million, including $22.61 million in capitalized operating costs, net of production revenue received during the pre-production period. Sustaining capital is estimated at $17.20 million, excluding $0.96 million for final closure costs.

Capital cost breakdown

Financial analysis

An after-tax model was developed for the Croinor Gold property. All costs are in 2017 Canadian dollars, with no allowance for inflation or escalation. The Croinor Gold property is subject to the following taxes:

  • Quebec mining duties
  • Federal and provincial income taxes

The economic valuation of the project was performed using the Internal Rate of Return (IRR) and Net Present Value (NPV) methods. The IRR on an investment is defined as the rate of interest earned on the unrecovered balance of an investment. The NPV method converts all cash flows for investments and revenues occurring throughout the planning horizon of a project to an equivalent single sum at present time at a specific discount rate. The discount rate used in the analysis is 5%. According to the NPV method, a positive NPV represents a profitable investment where the initial investment plus any financing interests are recovered. 

Qualified persons

The technical and scientific content of this press release has been reviewed and approved by Marc-André Lavergne, Eng., Monarques’s qualified person under National Instrument 43101. 

The prefeasibility study was prepared by InnovExplo, an independent firm, under the supervision of the following independent qualified persons (as defined by National Instrument 43-101): Laurent Roy, Eng., and Denis Gourde, Eng., for the engineering and economic evaluation component; and Karine Brousseau, Eng., for the resource component. The technical content of this press release has been reviewed and approved by the qualified persons of InnovExplo.


Monarques Gold Corp (TSX.V:MQR) is an emerging gold producer focused on pursuing growth through its large portfolio of high-quality projects in the Abitibi mining camp in Quebec, Canada. The Corporation currently owns close to 300 km² of gold properties (see map), including the Beaufor Mine, the Croinor Gold (see video), Wasamac, McKenzie Break and Swanson advanced projects, and the Camflo and Beacon mills, as well as six promising exploration projects. It also offers custom milling services out of its 1,600 tonne-per-day Camflo mill. Monarques enjoys a strong financial position and has more than 150 skilled employees who oversee its operating, development and exploration activities.

Forward-Looking Statements 

The forward-looking statements in this press release involve known and unknown risks, uncertainties and other factors that may cause Monarques’ actual results, performance and achievements to be materially different from the results, performance or achievements expressed or implied therein. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

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