Arizona Eagle Mining (TSXV: AZEM) has engaged Hancon Mining Division USA Corp. to complete engineering design work for reopening their past producing McCabe Mine, with the goal of moving drilling underground at its Eagle Project in Yavapai County, Arizona.
The pre-construction engineering agreement covers only the initial assessment phase. Hancon will survey and core sample the concrete in the Sooner Shaft and ventilation raise, dewater and pump test the shaft to roughly 300 feet, and complete detailed design and procurement planning for an Alimak raise-climber system.
Work is slated to begin on October 14.
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Initial costs under the study are capped at US$391,344. Hancon will be reimbursed up to US$326,120 in cash for actual costs, while its 20% margin of up to US$65,224 is expected to be settled in shares in the first quarter of 2027.
The full program carries an indicative budget of US$3.7 million, payable in cash and shares. That covers complete mine dewatering, rehabilitation of the ventilation raise, installation of the Alimak system, and development of access to the 830-foot level to reach drill-ready status. The work is expected to take an estimated 8 months, with a Phase 1 underground drill program targeted for the third quarter of 2027.
The rationale behind the reopening of the shaft comes down to drill costs. The company expects underground drilling to require about 5% of the metres needed to reach the same targets from surface, at a lower cost per metre.
CEO Kevin Reid said getting underground will “drastically increase our drilling output while also reducing costs,” adding that the company is fully funded to re-access the workings and start the first underground program.
The concrete-lined Sooner Shaft is 14 feet in diameter and reaches 1,620 feet, backed by at least 5 kilometres of drifts. Management estimates replacing it would cost roughly US$40 million and take 2 years. A camera lowered in September reached the shaft bottom without hitting any obstructions.
McCabe last produced in the 1980s. A 1984 historical estimate pegged the deposit at 880,000 ounces of gold at 11.7 g/t and 5 million ounces of silver at 69 g/t, though it is not NI 43-101 compliant and historical production came in at materially lower grades.
The engineering work runs in parallel with a SkyTEM airborne survey and the compilation of Phase 1 surface drilling results, which will inform underground targeting.
Arizona Eagle Mining last traded at $0.49 on the TSX Venture.
