Skeena Resources Recently Released a 4 Moz, 4.4 g/t AuEq, Open-Pit Resource at Eskay Creek

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After-tax NPV5% of C$638M (US$491M) and 51% IRR at US$1,325/oz Au and US$16/oz Ag

Pre-production capital expenditures (CAPEX) of C$303M (US$233M)

After-tax payback period of 1.2 years

Undervalued Relative To Comparables?

How Soon Can Eskay Creek Be Permitted?

Skeena is a proud co-founder of the BC Regional Mining Alliance – an alliance between government, First Nations and industry to promote mining investment in the Golden Triangle. 

Eskay Creek is located within the Tahltan Territory. The Tahltan consider themselves a mining nation as they have been mining obsidian for the last 10,000 years. Their land is home to three producing mines – Brucejack, Silvertip and Red Chris. 

Pretivm’s Brucejack mine was permitted in just under 2 years from beginning to end.

Given Skeena's PEA results, the Company should be on the watchlist of any serious gold investor. 

Here’s what you need to know:

Skeena released a combined Indicated and Inferred, 4 Moz, 4.4 g/t AuEq open-pit resource estimate and a positive Preliminary Economic Assessment in 2019. Highlights from the PEA include:

How Can Skeena Increase The Value Of Eskay Creek?

Current Activity 
Skeena recently signed a binding term sheet with Barrick to which Skeena will exercise its option to acquire 100% of Eskay Creek and Barrick will waive their 51% back-in right on the project. The transaction is expected to close in Q4 2020.

Skeena plans to drill a combined ~89,000 metres of exploration and infill drilling at Eskay Creek by the end of 2020. 


The results of Skeena's PEA may not have been surprising for early investors. This is because the pit sits on top the former highest-grade underground gold mine in the world!

Eskay Creek was in production in the late 90's when gold prices were $300/oz, which meant that only extremely high-grade ore could turn a profit. Fast forward to today, gold price is over $1700/oz and all of the ore that wasn’t profitable historically, is now economic.

Eskay Creek is Among The Highest-Grade Open-Pit Assets in the World

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A market cap comparison of the Company’s peers makes it clear that Skeena is extremely undervalued given the current resource at Eskay Creek.

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In comparison to open-pits around the world, Eskay Creek sits in the 95th percentile with an average grade of 4.3 g/t AuEq, almost 3 times higher than worldwide average!

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As Skeena moves closer to the completion of a Pre-Feasibility Study, the company plans to continue to do infill drilling in order to upgrade Inferred resources to the Indicated resource category. 

The Golden Triangle of British Columbia is a favourable place for mining investment, and here is proof:

Open-pit permits are common in the area with Red Chris, KSM and Galore Creek all being permitted within the last decade.

What To Do Next If You're Interested In Investing?

Skeena’s current P/NAV is 0.4x. Looking at the Company’s peers, Skeena should be sitting closer to a 0.6x or 0.7x P/NAV which would suggest a market cap of around C$650 Million instead of the current C$442 Million.

Paying closer attention to how well a project like Eskay Creek progresses can be the edge an investor needs in order to take advantage of market price perception versus reality!

Exploration Upside
The Lower Mudstone horizon holds significant exploration potential as it can be traced over 5,000 m along strike. It sits 100 m stratigraphically below the more familiar high-grade Contact Mudstone. In addition, below the 22 zone there are numerous high-grade hits open at depth. 

Diamond drill retrieving core on the Eskay Creek Project (2019)