Project Finance The Case Lode Project development options include own operate, lease, or sale. Funding options for GLC as owner operator include but are not limited to Preferred Stock Sale thru our Private Placement, JV, debt finance. or equipment finance. The Grant Lake Corporation owns the Case Mine and has the option to develop and operate the mine. If the option is exercised we will execute the 2018 – 2020 reserve expansion, pilot mill development and production plan currently budgeted at $7.1M. Core drilling, adits and pilot mill and infrastructure is estimated to cost 7.1M
Outlook After blocking out an estimated 600,000 tons of high-grade ore, the gold reserve is projected at up to 468,000 ounces au., as mine developers, we have the option to maintain small production of 25 tpd – $30k/day, sell the mine to a major mining company or raise the approximate $100M in capital and develop and operate the mine at 1,00o/tpd with estimated recovery of .5 o/t.
A second option for production includes a 50 tpd pilot mill that can produce a profit extracting 25 oz/au/day. This $30k per day cash flow will produce an annual profit of $1.5M. The $7.1M invested would be paid back at a 12% annual interest rate plus 12% of the Profit.
Claims Grant Lake Corporation, an Alaskan Corporation, is 70 years old this year. The company is wholly owned by Ted K. Stinson and Paul T. Torgerson, both residents of Anchorage, Alaska. Originally named Grant Lake Development Company, Inc., the company was founded in 1947 by Jack Merrington (1904-1997), the owner of the Case and Solar Mines. The Case Mine was discovered in 1911 by J.F. Case and E.E. Whitney. From 1947-1960 Merrington recovered 972 ounces au from 600 tons from the Q2-1600 level and Q5-1550 level veins. The ore grade on the tonnage was 1.62 ounces au/ton. In the winter of 1960- Stinson and Torgerson were hired by Merrington in 1987 to restart the Case Mine, In 1999, Stinson and Torgerson formed Grant Lake Mining Company to continue development of Case Mine. In February 2017, the company filed to add the new claims to its approved 2015 Case Mine-Grant Lake Mining Operating Plan with the U.S. Forest Service. The amendment to the operating plan was approved in March 2017. In May 2017, Grant Lake Corporation was re-incorporated. The corporation is in good standings and has no debts, and all claims are current and have clear titles.
Exploration The U.S. Forest Service (Hoekzema and Sherman; 1983) estimated Q5’s ore grade at .78 ounces au/ ton (opt au). The company uses the U.S.F.S. ore grade for ore reserve projections. Q2 and Q5 veins are spaced 100’ apart. The company plans contract core drilling and exploration adits on a 3,000’ section of the two veins to the west of the 1550 portal to a depth of up to 300 feet. The drilling program is projected to block out up to 600,000 tons of ore at .78 opt au; up to 468,000 ounces of gold.
Permits for the mine have been approved by the Chugach National Forest Service under a 5 year Operating Plan Agreement. This was issued in 2107 and carries through 2023. This permit is for the 3 year small production and drilling program and further development and small production for 2 more years. Operating Agreement changes will be submitted as project development funding is procured.
Infrastructure Construction of a 180’ single lane bridge across Trail River, upgrades to the 3 mile haul road from the mine to Trail River Bridge, and site development projects will proceed following a parallel path with the exploration projects. Infrastructure development is driven by exploration milestones. Gantt Chart & Cash Flow Model Short-term Exit Strategy.
The company has the option to commercialize the Case Mine. With an estimated 600,000 ton ore reserve ($585 Million), the company can finance mine commercialization and off-site mill construction. The equity investors would be reimburse at close of commercialization financing (end of year three). Construction and commercial startup would take up to 24 months (2020-2021). Operated at 300 tons/day-300 days/year, the mine would pay dividends of ~ $30.7 million per year for six-plus years.