Spectrum-GJ

The 43,500-hectare Spectrum-GJ copper-gold property consists of 93 contiguous mineral claims situated approximately 30 km west of Imperial Metals’ Red Chris Mine in the Golden Triangle of northwest British Columbia. Infrastructure and access to the property are excellent as the property is crossed by Highway 37, several forestry roads and winter trails, and the new 287 kV Northwest Transmission Line.

In April 2017, Skeena announced NI 43-101 Preliminary Economic Assessment (PEA) results for the project. Spectrum-GJ has a 25-year mine life with a low initial capex of CAD $216 million, a pre-tax 8% NPV of CAD $546 million and a 27% IRR. Skeena is actively seeking a partner to develop the asset to the pre-feasibility stage.

The property consists of two separate mineral resource estimates approximately 14 km apart: the porphyry copper-gold Donnelly Deposit at GJ (Donnelly) and the porphyry gold-copper Spectrum Central Zone (Spectrum). Conventional truck and shovel open pit mining is planned with a staged approach to production output, starting at 10,000 tonnes per day (tpd) at Donnelly, ramping up to 20,000 tpd in year 6 when Spectrum comes on-line, and reaching 30,000 tpd in year 12. The staged approach was adopted to limit operational, technical and capital risks that are typical of new mine start-ups. Using base case parameters, copper would generate approximately two-thirds of project revenue during the initial five years of production and approximately 58% over the life of the mine.

Geology and Mineralization

Spectrum

Two main styles of gold and copper mineralization are present at Spectrum: structurally-hosted, high-grade, sulphide-gold (>4 g/t Au) and bulk tonnage, disseminated, porphyry-style gold-copper mineralization. Both are spatially associated with steeply-dipping fractured and brecciated zones which are contained within a broad area of altered Stuhini Group intermediate volcanics and volcaniclastic rocks at the contact zone and within a dike-like monzonite intrusion of Jurassic age.

The Central Zone mineral resource at Spectrum consists of a broad zone of low-grade porphyry gold-copper mineralization cut by at least 4 sub-parallel steeply dipping higher-grade gold mineralized structures. Mineralization is subvertical and trends northerly. Mineralization consists of gold-bearing pyrite, native gold, arsenopyrite, chalcopyrite and sphalerite, and remains partially open along strike and down dip.

GJ

The GJ property hosts porphyry copper-gold mineralization related to quartz deficient intrusives wherein the Donnelly, North Donnelly, GJ, Wolf and North copper-gold porphyry zones have been the principal exploration targets, with the Donnelly Deposit being the focus of the current mineral resource. GJ is underlain by Stuhini Group rocks intruded by the Groat Stock which is unconformably overlain by Lower Jurassic Hazelton volcanic rocks. Porphyry-style alteration and copper-gold mineralization occur within the stock and in the Stuhini Group rocks where disseminated, fracture, quartz vein and quartz stockwork controlled pyrite with variable chalcopyrite containing elevated gold values have been identified.

*Resource calculations completed by David G. Thomas, P.Geo. See April 20, 2017 Skeena news release for more details. Metal prices of US$1,250/oz Au, US$2.75/lb Cu and US$17.75/oz Ag were used along with metallurgical recovery rates of 73% for Au, 90% for Cu and 50% for Ag.

Mineral resources that are not mineral reserves have not demonstrated economic viability. Mineral resource estimates do not account for mineability, selectivity, mining loss and dilution. These mineral resource estimates include inferred mineral resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred mineral resources will be converted to measured and indicated categories through further drilling, or into mineral reserves, once economic considerations are applied.

The technical information within this website has been reviewed by Michael S. Cathro, M.Sc., P.Geo., Skeena's Vice President of Operations, and a qualified person as defined by National Instrument 43-101.