Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 09, 2015 | Jun. 30, 2014 | |
Document and Entity Information | |||
Entity Registrant Name | INTERNATIONAL TOWER HILL MINES LTD | ||
Entity Central Index Key | 1134115 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $62,192,230 | ||
Entity Common Stock, Shares Outstanding | 116,313,638 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Current assets | ||
Cash and cash equivalents | $13,521,473 | $13,925,601 |
Prepaid expenses and other | 242,058 | 267,322 |
Total current assets | 13,763,531 | 14,192,923 |
Restricted cash | 30,477 | |
Property and equipment | 37,128 | 67,913 |
Capitalized acquisition costs | 55,204,041 | 55,173,564 |
Total assets | 69,004,700 | 69,464,877 |
Current liabilities | ||
Accounts payable | 270,488 | 42,469 |
Accrued liabilities | 878,682 | 1,451,227 |
Total current liabilities | 1,149,170 | 1,493,696 |
Non-current liabilities | ||
Derivative liability | 14,700,000 | 14,800,000 |
Total liabilities | 15,849,170 | 16,293,696 |
Shareholders' equity | ||
Share capital, no par value; authorized 500,000,000 shares; 116,313,638 and 98,068,638 shares issued and outstanding at December 31, 2014 and 2013, respectively | 243,692,185 | 236,401,096 |
Contributed surplus | 33,439,249 | 32,153,864 |
Accumulated other comprehensive income | 2,196,252 | 3,021,281 |
Deficit accumulated during the exploration stage | -226,172,156 | -218,405,060 |
Total shareholders' equity | 53,155,530 | 53,171,181 |
Total liabilities and shareholders' equity | $69,004,700 | $69,464,877 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Share capital, par value | $0 | $0 |
Share capital, authorized shares | 500,000,000 | 500,000,000 |
Share capital, shares issued | 116,313,638 | 98,068,638 |
Share capital, shares outstanding | 116,313,638 | 98,068,638 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Operating Expenses | |||
Consulting fees | $333,145 | $1,344,578 | $3,310,425 |
Depreciation | 15,779 | 21,800 | 31,660 |
Insurance | 270,724 | 284,993 | 310,549 |
Investor relations | 221,665 | 304,797 | 479,836 |
Mineral property exploration | 2,631,974 | 8,188,995 | 36,253,519 |
Office | 68,941 | 97,560 | 160,047 |
Other | 28,792 | 52,518 | 73,145 |
Professional fees | 389,218 | 467,510 | 613,056 |
Regulatory | 119,154 | 125,019 | 174,542 |
Rent | 225,405 | 226,477 | 251,835 |
Travel | 121,740 | 196,811 | 283,708 |
Wages and benefits | 3,946,751 | 6,863,713 | 13,643,058 |
Total operating expenses | -8,373,288 | -18,174,771 | -55,585,380 |
Other income (expenses) | |||
Gain on foreign exchange | 453,161 | 917,301 | 68,113 |
Interest income | 56,670 | 103,759 | 183,253 |
Income from mineral property earn-in | 290,552 | ||
Impairment of available-for-sale securities | -298,769 | ||
Unrealized gain/(loss) on derivative | 100,000 | 7,600,000 | -1,600,000 |
Other | -3,639 | ||
Total other income (expense) | 606,192 | 8,322,291 | -1,058,082 |
Net loss for the period | -7,767,096 | -9,852,480 | -56,643,462 |
Other comprehensive income (loss) | |||
Unrealized loss on available-for-sale securities | -24,717 | -118,917 | -163,176 |
Impairment of available-for-sale securities | 298,769 | ||
Exchange difference on translating foreign operations | -800,312 | -1,260,539 | 741,019 |
Total other comprehensive income (loss) for the period | -825,029 | -1,080,687 | 577,843 |
Comprehensive loss for the period | ($8,592,125) | ($10,933,167) | ($56,065,619) |
Basic and fully diluted net loss per share | ($0.08) | ($0.10) | ($0.62) |
Weighted average number of shares outstanding (in shares) | 99,068,364 | 98,068,638 | 91,112,934 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (USD $) | Share capital. | Contributed surplus | Accumulated other comprehensive income/(loss) | Deficit | Total |
Balance at Dec. 31, 2011 | $207,186,847 | $19,382,616 | $3,524,125 | ($151,909,118) | $78,184,470 |
Balance (in shares) at Dec. 31, 2011 | 86,683,919 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Private placement | 29,768,529 | 29,768,529 | |||
Private placement (in shares) | 11,384,719 | ||||
Share issuance costs | -554,280 | -554,280 | |||
Stock based compensation | 9,206,975 | 9,206,975 | |||
Unrealized loss on available-for-sale securities | -163,176 | -163,176 | |||
Exchange difference on translating foreign operations | 741,019 | 741,019 | |||
Net loss | -56,643,462 | -56,643,462 | |||
Balance at Dec. 31, 2012 | 236,401,096 | 28,589,591 | 4,101,968 | -208,552,580 | 60,540,075 |
Balance (in shares) at Dec. 31, 2012 | 98,068,638 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Stock based compensation | 3,564,273 | 3,564,273 | |||
Unrealized loss on available-for-sale securities | -118,917 | -118,917 | |||
Impairment of available-for-sale securities | 298,769 | 298,769 | |||
Exchange difference on translating foreign operations | -1,260,539 | -1,260,539 | |||
Net loss | -9,852,480 | -9,852,480 | |||
Balance at Dec. 31, 2013 | 236,401,096 | 32,153,864 | 3,021,281 | -218,405,060 | 53,171,181 |
Balance (in shares) at Dec. 31, 2013 | 98,068,638 | 98,068,638 | |||
Increase (Decrease) in Stockholders' Equity | |||||
Private placement | 7,315,917 | 7,315,917 | |||
Private placement (in shares) | 18,245,000 | ||||
Share issuance costs | -24,828 | -24,828 | |||
Stock based compensation | 1,285,385 | 1,285,385 | |||
Unrealized loss on available-for-sale securities | -24,717 | -24,717 | |||
Exchange difference on translating foreign operations | -800,312 | -800,312 | |||
Net loss | -7,767,096 | -7,767,096 | |||
Balance at Dec. 31, 2014 | $243,692,185 | $33,439,249 | $2,196,252 | ($226,172,156) | $53,155,530 |
Balance (in shares) at Dec. 31, 2014 | 116,313,638 | 116,313,638 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Operating Activities | |||
Loss for the period | ($7,767,096) | ($9,852,480) | ($56,643,462) |
Add items not affecting cash: | |||
Depreciation | 15,779 | 21,800 | 31,660 |
Share-based payments | 1,285,385 | 3,564,273 | 9,206,975 |
Unrealized (gain) loss on derivative liability | -100,000 | -7,600,000 | 1,600,000 |
Impairment of available-for-sale securities | 298,769 | ||
Write-down of advance to contractors | 482,009 | ||
Other | 15,004 | -42,017 | |
Changes in non-cash items: | |||
Accounts receivable | 44,744 | 393,437 | 174,537 |
Prepaid expenses | 25,727 | 18,193 | -42,512 |
Advance to contractors | -30,682 | 100,000 | -102,009 |
Accounts payable and accrued liabilities | -332,439 | -2,246,348 | -6,582,823 |
Cash used in operating activities | -6,843,578 | -14,820,347 | -52,399,651 |
Financing Activities | |||
Issuance of share capital | 7,315,917 | 29,768,529 | |
Share issuance costs | -24,828 | -554,280 | |
Cash provided by financing activities | 7,291,089 | 29,214,249 | |
Investing Activities | |||
Change in restricted cash | 30,477 | -30,477 | |
Capitalized acquisition costs | -30,477 | -2,127,693 | |
Expenditures on property and equipment, net | 3,635 | ||
Cash used in investing activities | -30,477 | -2,124,058 | |
Effect of foreign exchange on cash | -851,639 | -1,394,480 | 768,292 |
Decrease in cash and cash equivalents | -404,128 | -16,245,304 | -24,541,168 |
Cash and cash equivalents, beginning of period | 13,925,601 | 30,170,905 | 54,712,073 |
Cash and cash equivalents, end of period | $13,521,473 | $13,925,601 | $30,170,905 |
GENERAL_INFORMATION_NATURE_AND
GENERAL INFORMATION, NATURE AND CONTINUANCE OF OPERATIONS | 12 Months Ended |
Dec. 31, 2014 | |
GENERAL INFORMATION, NATURE AND CONTINUANCE OF OPERATIONS | |
GENERAL INFORMATION, NATURE AND CONTINUANCE OF OPERATIONS | 1.GENERAL INFORMATION, NATURE AND CONTINUANCE OF OPERATIONS |
International Tower Hill Mines Ltd. (“ITH” or the “Company”) is incorporated under the laws of British Columbia, Canada. The Company’s head office address is 2300-1177 West Hastings Street, Vancouver, British Columbia, Canada. International Tower Hill Mines Ltd. consists of ITH and its wholly owned subsidiaries Tower Hill Mines, Inc. (“TH Alaska”) (an Alaska corporation), Tower Hill Mines (US) LLC (“TH US”) (a Colorado limited liability company), Livengood Placers, Inc. (“LPI”) (a Nevada corporation), and 813034 Alberta Ltd. (an Alberta corporation). The Company is in the business of acquiring, exploring and evaluating mineral properties, and either joint venturing or developing these properties further or disposing of them when the evaluation is completed. At December 31, 2014, the Company was in the exploration stage and controls a 100% interest in its Livengood Gold Project in Alaska, U.S.A. | |
These consolidated financial statements have been prepared on a going-concern basis, which presumes the realization of assets and discharge of liabilities in the normal course of business for the foreseeable future. | |
The business of mining and exploration involves a high degree of risk and there can be no assurance that current exploration programs will result in profitable mining operations. The Company has no source of revenue, and has significant cash requirements to meet its administrative overhead and maintain its mineral property interests. The recoverability of amounts shown for capitalized acquisition costs is dependent on several factors. These include the discovery of economically recoverable reserves, the ability of the Company to obtain the necessary financing to complete the development of these properties, and future profitable production or proceeds from disposition of capitalized acquisition costs. The success of the above initiatives cannot be assured. In the event that the Company is unable to obtain the necessary financing, it may be necessary to defer certain discretionary expenditures and other planned activities. | |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | |||
Dec. 31, 2014 | ||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Basis of presentation | ||||
These consolidated financial statements are presented in United States dollars and have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). | ||||
Basis of consolidation | ||||
These consolidated financial statements include the accounts of ITH and its wholly owned subsidiaries TH Alaska, TH US, LPI and 813034 Alberta Ltd. All intercompany transactions and balances have been eliminated. | ||||
Significant judgments, estimates and assumptions | ||||
The preparation of financial statements in accordance with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the period. These judgments, estimates and assumptions are regularly evaluated and are based on management’s experience and knowledge of the relevant facts and circumstances. While management believes the estimates to be reasonable, actual results could differ from those estimates and could impact future results of operations and cash flows. | ||||
The areas which require significant judgment and estimates that management has made at the financial reporting date, that could result in a material change to the carrying amounts of assets and liabilities, in the event actual results differ from the assumptions made, relate to, but are not limited to the following: | ||||
Significant estimates | ||||
· | the fair value determination and inputs used in the valuation of the derivative liability (see note 6). | |||
Significant judgments | ||||
· | the determination of functional currencies; | |||
· | quantitative and qualitative factors used in the assessment of impairment of the Company’s capitalized acquisition costs; and | |||
· | the analysis of resource calculations, drill results, labwork, etc. which can impact the Company’s assessment of impairments, and provisions, if any, for environmental rehabilitation and restoration. | |||
Cash and cash equivalents | ||||
Cash equivalents include highly liquid investments with original maturities of three months or less, and which are subject to an insignificant risk of change in value. Cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. | ||||
Marketable securities | ||||
Marketable securities held in companies with an active market are classified as available-for-sale securities. Available-for-sale securities are recorded at fair value in the financial statements with unrealized gains and losses recorded in accumulated other comprehensive income. Accumulated unrealized gains and losses are recognized in the statement of operations upon the sale of the security or if the security is determined to be impaired. | ||||
Property and equipment | ||||
On initial recognition, property and equipment are valued at cost. Property and equipment is subsequently measured at cost less accumulated depreciation, less any accumulated impairment losses, with the exception of land which is not depreciated. Depreciation is recorded over the estimated useful life of the assets at the following annual rates: | ||||
Computer equipment - 30% declining balance; | ||||
Computer software - 3 years straight line; | ||||
Furniture and equipment -20% declining balance; and | ||||
Leasehold improvements - straight-line over the lease term. | ||||
Additions during the year are depreciated at one-half the annual rates. Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate. | ||||
Mineral properties and exploration and evaluation expenditures | ||||
The Company’s mineral project is currently in the exploration and evaluation phase. Mineral property acquisition costs are capitalized when incurred. Mineral property exploration costs are expensed as incurred. At such time that the Company determines that a mineral property can be economically developed, subsequent mineral property expenses will be capitalized during the development of such property. | ||||
The Company assesses interests in exploration properties for impairment when facts and circumstances suggest that the carrying amount of an asset may exceed its recoverable amount. Impairment analysis includes assessment of the following circumstances: a significant decrease in the market price of a long-lived asset or asset group; a significant adverse change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition; a significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset or asset group, including an adverse action or assessment by a regulator; an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset or asset group; a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group; a current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The term more likely than not refers to a level of likelihood that is more than 50%. | ||||
The Company’s assessment of impairment related to its capitalized acquisition costs at December 31, 2014 was based on estimated undiscounted future cash flows expected to result from the use and eventual disposition of these assets. The assessment took into account the Company’s expectation for the future price of gold as well as the probability of achieving certain opportunities to enhance the economics of the Livengood Gold Project as set out in the September 2013 Study and as subsequently developed by the Company. Based on this assessment, no impairments were recorded at December 31, 2014. | ||||
Asset retirement obligations | ||||
The Company records a liability based on the best estimate of costs for site closure and reclamation activities that the Company is legally or contractually required to remediate and recorded at the time environmental disturbance occurs. The provision for closure and reclamation liabilities is estimated using expected cash flows based on engineering and environmental reports and accreted to full value over time through periodic charges to income. The Company does not have any material provisions for environmental rehabilitation as of December 31, 2014. | ||||
Derivatives | ||||
Derivative financial liabilities include the Company’s future contingent mineral property payment valued using estimated future gold prices. Derivatives are initially recognized at their fair value on the date the derivative contract is entered into and are subsequently re-measured at their fair value at each reporting period with changes in the fair value recognized in the statement of operations. | ||||
Income taxes | ||||
The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under the asset and liability method, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion or the entire deferred tax asset will not be recognized. | ||||
Net loss per share | ||||
Basic loss per share is calculated using the weighted average number of common shares outstanding during the period. Diluted loss per share reflects the potential dilution that could occur if securities or contracts that may require the issuance of common shares in the future were converted, unless the impact is anti-dilutive. | ||||
Stock-based compensation | ||||
The Company follows the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Section 718 “Compensation - Stock Compensation”, which establishes accounting for equity based compensation awards to be accounted for using the fair value method. The Company uses the Black-Scholes option pricing model to determine the grant date fair value of the awards. Compensation expense is measured at the grant date and recognized over the requisite service period, which is generally the vesting period. | ||||
Recently Issued Accounting Pronouncements | ||||
In June 2014, the FASB issued Accounting Standards Update 2014-12, Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (“ASU 2014-12”). The amendments in ASU 2014-12 require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in ASC 718, as it relates to awards with performance conditions that affect vesting to account for such awards. The amendments in ASU 2014-12 are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. The adoption of ASU 2014-12 is not expected to have a material impact on our financial position, results of operations or cash flows. | ||||
Recently Adopted Accounting Pronouncements | ||||
In June 2014, the FASB issued Accounting Standards Update 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements (“ASU 2014-10”). ASU 2014-10 eliminates the distinction of a development stage entity and certain related disclosure requirements, including the elimination of inception-to-date information on the statements of operations, cash flows and stockholders’ equity. The amendments in ASU 2014-10 are effective for annual reporting periods beginning after December 15, 2014, and interim periods within those annual periods. Early adoption of this standard is permitted and the Company adopted the provisions of ASU 2014-10 during the quarter ended June 30, 2014. The adoption of ASU 2014-10 impacts the presentation of the statements of operations and comprehensive income and the statements of cash flows as these statements no longer contain financial information from the inception of the Company to the date of the financial statements. | ||||
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | 3.FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||
The carrying values of cash and cash equivalents, accounts receivable and accounts payable and accrued liabilities approximate their fair values due to the short-term maturity of these financial instruments. | ||||||||
Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the significance of the inputs used in making the measurement. The three levels of the fair value hierarchy are as follows: | ||||||||
Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities; | ||||||||
Level 2 — Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and, | ||||||||
Level 3 — Inputs that are not based on observable market data. | ||||||||
Fair value as at December 31, 2014 | ||||||||
Level 1 | Level 2 | |||||||
Financial assets: | ||||||||
Marketable securities | $ | 26,894 | $ | — | ||||
$ | 26,894 | $ | — | |||||
Financial liabilities: | ||||||||
Derivative liability (note 6) | $ | — | $ | 14,700,000 | ||||
$ | — | $ | 14,700,000 | |||||
Fair value as at December 31, 2013 | ||||||||
Level 1 | Level 2 | |||||||
Financial assets: | ||||||||
Marketable securities | $ | 55,002 | $ | — | ||||
$ | 55,002 | $ | — | |||||
Financial liabilities: | ||||||||
Derivative liability (note 6) | $ | — | $ | 14,800,000 | ||||
$ | — | $ | 14,800,000 | |||||
CAPITALIZED_ACQUISITION_COSTS
CAPITALIZED ACQUISITION COSTS | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
CAPITALIZED ACQUISITION COSTS | ||||||||
CAPITALIZED ACQUISITION COSTS | 4.CAPITALIZED ACQUISITION COSTS | |||||||
The Company had the following activity related to capitalized acquisition costs: | ||||||||
Capitalized acquisition costs | Amount | |||||||
Balance, December 31, 2013 | $ | 55,173,564 | ||||||
Additions | 30,477 | |||||||
Balance, December 31, 2014 | $ | 55,204,041 | ||||||
The following table presents costs incurred for exploration and evaluation activities for the years ended December 31, 2014 and 2013: | ||||||||
Year ended | Year ended | |||||||
December 31, 2014 | December 31, 2013 | |||||||
Exploration costs: | ||||||||
Aircraft services | $ | 10,286 | $ | 68,577 | ||||
Assay | 8,163 | 21,712 | ||||||
Drilling | 119,036 | 451,286 | ||||||
Environmental | 1,201,642 | 2,235,287 | ||||||
Equipment rental | 52,709 | 344,063 | ||||||
Field costs | 211,848 | 825,642 | ||||||
Geological/geophysical | 70,388 | 3,367,799 | ||||||
Land maintenance & tenure | 530,543 | 470,489 | ||||||
Legal | 367,556 | 256,965 | ||||||
Surveying and mapping | 26,503 | 95,638 | ||||||
Transportation and travel | 33,300 | 51,537 | ||||||
Total expenditures for the period | $ | 2,631,974 | $ | 8,188,995 | ||||
Properties acquired from AngloGold, Alaska | ||||||||
Pursuant to an Asset Purchase and Sale and Indemnity Agreement dated June 30, 2006, as amended on July 26, 2007 (the “AngloGold Agreement”), among the Company, AngloGold Ashanti (U.S.A.) Exploration Inc. (“AngloGold”) and TH Alaska, the Company acquired all of AngloGold’s interest in a portfolio of seven mineral exploration projects in Alaska and referred to as the Livengood, Chisna, Gilles, Coffee Dome, West Pogo, Blackshell, and Caribou properties (the “Sale Properties”) in exchange for a cash payment of $50,000 on August 4, 2006, and the issuance of 5,997,295 common shares, representing approximately 19.99% of the Company’s issued shares following the closing of the acquisition and two private placement financings raising an aggregate of C$11,479,348. AngloGold had the right to maintain its percentage equity interest in the Company, on an ongoing basis, provided that such right terminated if AngloGold’s interest was reduced below 10% at any time after January 1, 2009. | ||||||||
As further consideration for the transfer of the Sale Properties, the Company granted to AngloGold a 90 day right of first offer with respect to the Sale Properties and any additional mineral properties in Alaska in which the Company acquires an interest and which interest the Company proposes to farm out or otherwise dispose of. Upon AngloGold’s equity interest in the Company being reduced to less than 10%, this right of first offer would then terminate. On December 11, 2014 the Company closed a private placement financing (see note 8 below) in which AngloGold elected not to participate. As a result of the shares issued in this private placement, AngloGold’s ownership in the Company was reduced to less than 10% and thus both AngloGold’s right to maintain its ownership percentage interest and its right of first offer on the Company’s Alaskan properties terminated upon the closing of the private placement. | ||||||||
Details of the Livengood Property (being the only Sale Property still held by the Company) are as follows: | ||||||||
Livengood Property: | ||||||||
The Livengood property is located in the Tintina gold belt approximately 113 kilometers (70 miles) north of Fairbanks, Alaska. The property consists of land leased from the Alaska Mental Health Trust, a number of smaller private mineral leases, Alaska state mining claims purchased or located by the Company and patented ground held by the Company. | ||||||||
Details of the leases are as follows: | ||||||||
a) | a lease of the Alaska Mental Health Trust mineral rights having a term beginning July 1, 2004 and extending 19 years until June 30, 2023, subject to further extensions beyond June 30, 2023 by either commercial production or payment of an advance minimum royalty equal to 125% of the amount paid in year 19 and diligent pursuit of development. The lease requires minimum work expenditures and advance minimum royalties which escalate annually with inflation. A net smelter return (“NSR”) production royalty of between 2.5% and 5.0% (depending upon the price of gold) is payable to the lessor with respect to the lands subject to this lease. In addition, an NSR production royalty of l% is payable to the lessor with respect to the unpatented federal mining claims subject to the lease described in b) below and an NSR production royalty of between 0.5% and 1.0% (depending upon the price of gold) is payable to the lessor with respect to the lands acquired by the Company as a result of the purchase of Livengood Placers, Inc. in December 2011. As of December 31, 2014 the Company has paid $1,648,923 from the inception of this lease. | |||||||
b) | a lease of federal unpatented lode mining claims having an initial term of ten years commencing on April 21, 2003 and continuing for so long thereafter as advance minimum royalties are paid and mining related activities, including exploration, continue on the property or on adjacent properties controlled by the Company. The lease requires an advance minimum royalty of $50,000 on or before each anniversary date (all of which minimum royalties are recoverable from production royalties). An NSR production royalty of between 2% and 3% (depending on the price of gold) is payable to the lessors. The Company may purchase 1% of the royalty for $1,000,000. As of December 31, 2014, the Company has paid $530,000 from the inception of this lease. | |||||||
c) | a lease of patented lode claims having an initial term of ten years commencing January 18, 2007, and continuing for so long thereafter as advance minimum royalties are paid. The lease requires an advance minimum royalty of $20,000 on or before each anniversary date through January 18, 2017 and $25,000 on or before each subsequent anniversary (all of which minimum royalties are recoverable from production royalties). An NSR production royalty of 3% is payable to the lessors. The Company may purchase all interests of the lessors in the leased property (including the production royalty) for $1,000,000 (less all minimum and production royalties paid to the date of purchase), of which $500,000 is payable in cash over four years following the closing of the purchase and the balance of $500,000 is payable by way of the 3% NSR production royalty. As of December 31, 2014, the Company has paid $125,000 from the inception of this lease. | |||||||
d) | a lease of unpatented federal lode mining and federal unpatented placer claims having an initial term of ten years commencing on March 28, 2007, and continuing for so long thereafter as advance minimum royalties are paid and mining related activities, including exploration, continue on the property or on adjacent properties controlled by the Company. The lease requires an advance minimum royalty of $15,000 on or before each anniversary date (all of which minimum royalties are recoverable from production royalties). The Company is required to pay the lessor the sum of $250,000 upon making a positive production decision, payable $125,000 within 120 days of the decision and $125,000 within a year of the decision (all of which are recoverable from production royalties). An NSR production royalty of 2% is payable to the lessor. The Company may purchase all of the interest of the lessor in the leased property (including the production royalty) for $1,000,000. As of December 31, 2014, the Company has paid $83,000 from the inception of this lease. | |||||||
Title to mineral properties | ||||||||
The acquisition of title to mineral properties is a detailed and time-consuming process. The Company has taken steps to verify title to mineral properties in which it has an interest. Although the Company has taken every reasonable precaution to ensure that legal title to its properties is properly recorded in the name of the Company, there can be no assurance that such title will ultimately be secured. | ||||||||
ACCRUED_LIABILITIES
ACCRUED LIABILITIES | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
ACCRUED LIABILITIES | ||||||||
ACCRUED LIABILITIES | 5.ACCRUED LIABILITIES | |||||||
The following table presents the accrued liabilities balances at December 31, 2014 and 2013. | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Accrued liabilities | $ | 334,423 | $ | 540,486 | ||||
Accrued severance | 390,659 | 719,375 | ||||||
Accrued salaries and benefits | 153,600 | 191,366 | ||||||
Total accrued liabilities | $ | 878,682 | $ | 1,451,227 | ||||
Accrued liabilities at December 31, 2014 include accruals for general corporate costs and project costs of $74,413 and $260,010, respectively. Accrued liabilities at December 31, 2013 include accruals for general corporate costs and project costs of $115,020 and $425,466, respectively. | ||||||||
DERIVATIVE_LIABILITY
DERIVATIVE LIABILITY | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
DERIVATIVE LIABILITY | ||||||||
DERIVATIVE LIABILITY | 6.DERIVATIVE LIABILITY | |||||||
During 2011, the Company acquired certain mining claims and related rights in the vicinity of the Livengood Gold Project located near Fairbanks, Alaska. The aggregate consideration for the claims and rights was $13,500,000 in cash plus an additional contingent payment based on the five-year average daily gold price (“Average Gold Price”) from the date of the acquisition. The contingent payment will equal $23,148 for every dollar that the Average Gold Price exceeds $720 per troy ounce. If the Average Gold Price is less than $720, there will be no additional contingent payment. | ||||||||
At initial recognition on December 13, 2011 the derivative liability was valued at $23,100,000. The key assumption used in the valuation of the derivative is the estimate of the future Average Gold Price. The estimate of the future Average Gold Price was determined using a forward curve on future gold prices as published by the CME Group. The CME Group represents the merger of the Chicago Mercantile Exchange (CME), the Chicago Board of Trade (CBOT), the New York Mercantile Exchange (NYMEX) and its commodity exchange division, Commodity Exchange, Inc. (COMEX). Using this forward curve, the Company estimated an Average Gold Price based on actual gold prices to December 31, 2014 and projected gold prices from December 31, 2014 to the end of the five year period in December 2016 of $1,356 per ounce of gold. | ||||||||
The fair value of the derivative liability and the estimated Average Gold Price are as follows: | ||||||||
Fair value | Average Gold | |||||||
Price/oz. | ||||||||
Derivative value at December 31, 2012 | $ | 22,400,000 | $ | 1,688 | ||||
Unrealized gain for the year | (7,600,000 | ) | ||||||
Derivative value at December 31, 2013 | 14,800,000 | $ | 1,360 | |||||
Unrealized gain for the year | (100,000 | ) | ||||||
Derivative value at December 31, 2014 | $ | 14,700,000 | $ | 1,356 | ||||
INCOME_TAXES
INCOME TAXES | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
INCOME TAXES | ||||||||
INCOME TAXES | 7.INCOME TAXES | |||||||
A reconciliation of income taxes at statutory rates with the reported taxes is as follows for the years ended December 31, 2014 and 2013: | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Loss before income taxes | $ | (7,767,096 | ) | $ | (9,852,480 | ) | ||
Statutory Canadian corporate tax rate | 25 | % | 25 | % | ||||
Income tax recovery at statutory rates | $ | (1,941,774 | ) | $ | (2,463,120 | ) | ||
Share-based payments | 321,346 | 891,068 | ||||||
Unrecognized items for tax purposes | (5,383 | ) | (1,634,335 | ) | ||||
Difference in tax rates in other jurisdictions | (1,072,910 | ) | (1,036,959 | ) | ||||
Unrecognized amounts | 2,698,721 | 4,243,346 | ||||||
Income tax recovery | $ | — | $ | — | ||||
The significant components of the Company’s deferred income tax assets and liabilities are as follows: | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Deferred income tax assets (liabilities): | ||||||||
Mineral properties | $ | 57,243,322 | $ | 57,243,322 | ||||
Derivative liability | (1,822,800 | ) | (1,801,100 | ) | ||||
Other | 62,329 | 63,539 | ||||||
Share issue costs | 148,685 | 409,503 | ||||||
Non-capital losses available for future periods | 31,229,931 | 28,245,574 | ||||||
86,861,467 | 84,160,838 | |||||||
Valuation allowance | (86,861,467 | ) | (84,160,838 | ) | ||||
Deferred income tax asset | $ | — | $ | — | ||||
At December 31, 2014, the Company has available net operating losses for Canadian income tax purposes of approximately $17,536,000 and net operating losses for US income tax purposes of approximately $61,857,000 available for carry-forward to reduce future years’ taxable income, if not utilized, expiring as follows: | ||||||||
Canada | United States | |||||||
2025 | $ | 65,000 | $ | — | ||||
2026 | 78,000 | — | ||||||
2027 | 907,000 | 1,252,000 | ||||||
2028 | 1,253,000 | 1,350,000 | ||||||
2029 | 2,074,000 | 2,600,000 | ||||||
2030 | 2,829,000 | 5,691,000 | ||||||
2031 | 4,180,000 | 14,730,000 | ||||||
2032 | 2,629,000 | 18,371,000 | ||||||
2033 | 1,827,000 | 11,962,000 | ||||||
2034 | 1,694,000 | 5,901,000 | ||||||
17,536,000 | 61,857,000 | |||||||
In addition, the Company has available mineral resource related expenditure pools for Canadian income tax purposes totalling approximately $2,628,000 which may be deducted against future taxable income in Canada on a discretionary basis. The Company also has available mineral resource expenses that are related to the Company’s exploration activities in the United States of approximately $185,999,000 which may be deductible for U.S. tax purposes. Future tax benefits, which may arise as a result of applying these deductions to taxable income, have not been recognized in these accounts due to the uncertainty of future taxable income. | ||||||||
SHARE_CAPITAL
SHARE CAPITAL | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
SHARE CAPITAL | ||||||||||||||||
SHARE CAPITAL | 8.SHARE CAPITAL | |||||||||||||||
Authorized | ||||||||||||||||
500,000,000 common shares without par value. At December 31, 2014 and 2013 there were 116,313,638 and 98,068,638 shares issued and outstanding, respectively. | ||||||||||||||||
Share issuances | ||||||||||||||||
During the fourth quarter of 2014, the Company closed a non-brokered private placement financing through the issuance of 18,245,000 common shares issued at C$0.46 per share for gross proceeds of $7,315,917. The financing closed on December 11, 2014. Total share issuance costs for this non-brokered private placement financing amounted to $24,828. | ||||||||||||||||
Stock options | ||||||||||||||||
The Company has adopted an incentive stock option plan (the “2006 Plan”). The essential elements of the 2006 Plan provide that the aggregate number of common shares of the Company’s capital stock that may be made issuable pursuant to options granted under the 2006 Plan may not exceed 10% of the number of issued shares of the Company at the time of the granting of the options. Options granted under the 2006 Plan will have a maximum term of ten years. The exercise price of options granted under the 2006 Plan shall be fixed in compliance with the applicable provisions of the TSX Company Manual in force at the time of grant and, in any event, shall not be less than the closing price of the Company’s common shares on the TSX on the trading day immediately preceding the day on which the option is granted, or such other price as may be agreed to by the Company and accepted by the Toronto Stock Exchange. Options granted under the 2006 Plan vest immediately, unless otherwise determined by the directors at the date of grant. All options granted during the years ended December 31, 2014 and 2013 vest as to one-third on the date of grant, one-third on the first anniversary, and the balance on the second anniversary. | ||||||||||||||||
A summary of the status of the stock option plan as of December 31, 2014 and 2013 and changes during the periods is presented below: | ||||||||||||||||
Year Ended | Year Ended | |||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||
Number of | Weighted | Number of | Weighted | |||||||||||||
Options | Average Exercise | Options | Average Exercise | |||||||||||||
Price (C$) | Price (C$) | |||||||||||||||
Balance, beginning of the period | 5,493,000 | $ | 3.57 | 8,570,000 | $ | 4.73 | ||||||||||
Granted | 2,480,000 | $ | 1 | 613,000 | $ | 2.18 | ||||||||||
Expired | — | $ | — | (1,040,000 | ) | $ | 7.78 | |||||||||
Forfeited | (600,000 | ) | $ | 3.17 | (1,550,000 | ) | $ | 3.27 | ||||||||
Cancelled | (1,519,000 | ) | $ | 2.97 | (1,100,000 | ) | $ | 8.27 | ||||||||
Balance, end of the period | 5,854,000 | $ | 2.68 | 5,493,000 | $ | 3.57 | ||||||||||
The weighted average remaining life of options outstanding at December 31, 2014 was 4.5 years. | ||||||||||||||||
Stock options outstanding are as follows: | ||||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||
Expiry Date | Exercise | Number of | Exercisable | Exercise | Number of | Exercisable | ||||||||||
Price (C$) | Options | Price (C$) | Options | |||||||||||||
August 23, 2016 | $ | 8.07 | 600,000 | 600,000 | $ | 8.07 | 600,000 | 600,000 | ||||||||
January 9, 2017 | $ | 4.60 | 30,000 | 30,000 | $ | 4.60 | 30,000 | 20,000 | ||||||||
August 24, 2017 | $ | 3.17 | 2,275,000 | 2,275,000 | $ | 3.17 | 3,350,000 | 2,233,322 | ||||||||
September 19, 2017 | — | — | — | $ | 2.91 | 1,000,000 | 666,666 | |||||||||
March 14, 2018 | $ | 2.18 | 469,000 | 312,660 | $ | 2.18 | 513,000 | 170,995 | ||||||||
February 25, 2022 | $ | 1.11 | 1,360,000 | 453,333 | — | — | — | |||||||||
February 25, 2022 | $ | 0.73 | 690,000 | 230,000 | — | — | — | |||||||||
March 10, 2022 | $ | 1.11 | 430,000 | 143,333 | — | — | — | |||||||||
5,854,000 | 4,044,326 | 5,493,000 | 3,690,983 | |||||||||||||
A summary of the non-vested options as of December 31, 2014 and 2013 and changes during the fiscal years ended December 31, 2014 and 2013 is as follows: | ||||||||||||||||
Non-vested options: | Number of | Weighted | ||||||||||||||
options | average grant- | |||||||||||||||
date fair value | ||||||||||||||||
(C$) | ||||||||||||||||
Outstanding at December 31, 2012 | 4,386,680 | $ | 2.05 | |||||||||||||
Granted | 613,000 | $ | 0.5 | |||||||||||||
Vested | (2,547,660 | ) | $ | 2.27 | ||||||||||||
Forfeited | (650,003 | ) | $ | 1.57 | ||||||||||||
Outstanding at December 31, 2013 | 1,802,017 | $ | 1.38 | |||||||||||||
Granted | 2,480,000 | $ | 0.49 | |||||||||||||
Vested | (2,272,342 | ) | $ | 1.1 | ||||||||||||
Forfeited | (200,001 | ) | $ | 1.61 | ||||||||||||
Outstanding at December 31, 2014 | 1,809,674 | $ | 0.49 | |||||||||||||
At December 31, 2014 there was unrecognized compensation expense of C$308,850 related to non-vested options outstanding. The cost is expected to be recognized over a weighted-average remaining period of approximately 0.93 years. | ||||||||||||||||
Share-based payments | ||||||||||||||||
During the year ended December 31, 2014, the Company granted 2,480,000 stock options with a fair value of C$1,224,537, calculated using the Black-Scholes option pricing model. The Company recognized share-based payment expense of $1,285,385, $3,564,273 and $9,206,975 during the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||||||||||
The following weighted average assumptions were used for the Black-Scholes option pricing model calculations: | ||||||||||||||||
Year ended | Year ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2014 | 2013 | |||||||||||||||
Expected life of options | 6 years | 4 years | ||||||||||||||
Risk-free interest rate | 1.83 | % | 1.29 | % | ||||||||||||
Expected volatility | 81.02 | % | 59.48 | % | ||||||||||||
Dividend rate | 0.00 | % | 0.00 | % | ||||||||||||
Exercise price (C$) | $ | 1.00 | $ | 2.18 | ||||||||||||
The expected volatility used in the Black-Scholes option pricing model is based on the historical volatility of the Company’s shares. | ||||||||||||||||
SEGMENT_AND_GEOGRAPHIC_INFORMA
SEGMENT AND GEOGRAPHIC INFORMATION | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
SEGMENT AND GEOGRAPHIC INFORMATION | |||||||||||
SEGMENT AND GEOGRAPHIC INFORMATION | 9.SEGMENT AND GEOGRAPHIC INFORMATION | ||||||||||
The Company operates in a single reportable operating segment, being the exploration and development of mineral properties. The following tables present selected financial information by geographic location: | |||||||||||
Canada | United States | Total | |||||||||
December 31, 2014 | |||||||||||
Capitalized acquisition costs | $ | — | $ | 55,204,041 | $ | 55,204,041 | |||||
Property and equipment | 10,477 | 26,651 | 37,128 | ||||||||
Current assets | 13,003,412 | 760,119 | 13,763,531 | ||||||||
Total assets | $ | 13,013,889 | $ | 55,990,811 | $ | 69,004,700 | |||||
December 31, 2013 | |||||||||||
Capitalized acquisition costs | $ | — | $ | 55,173,564 | $ | 55,173,564 | |||||
Restricted cash | — | 30,477 | 30,477 | ||||||||
Property and equipment | 11,994 | 55,919 | 67,913 | ||||||||
Current assets | 13,289,752 | 903,171 | 14,192,923 | ||||||||
Total assets | $ | 13,301,746 | $ | 56,163,131 | $ | 69,464,877 | |||||
Year ended | Year ended | Year ended | |||||||||
December 31, | December 31, | December 31, | |||||||||
2014 | 2013 | 2012 | |||||||||
Net loss for the period - Canada | $ | (1,936,065 | ) | $ | (4,216,835 | ) | $ | (10,589,464 | ) | ||
Net loss for the period - United States | (5,831,031 | ) | (5,635,645 | ) | (46,053,998 | ) | |||||
Net loss for the period | $ | (7,767,096 | ) | $ | (9,852,480 | ) | $ | (56,643,462 | ) | ||
COMMITMENTS
COMMITMENTS | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||
COMMITMENTS | |||||||||||||||||||||||
COMMITMENTS | 10.COMMITMENTS | ||||||||||||||||||||||
The following table discloses, as of December 31, 2014, the Company’s contractual obligations including anticipated mineral property payments and work commitments and committed office and equipment lease obligations. Under the terms of the Company’s mineral property purchase agreements, mineral leases and the terms of the unpatented mineral claims held by it, the Company is required to make certain scheduled acquisition payments, incur certain levels of expenditures, make lease or advance royalty payments, make payments to government authorities and incur assessment work expenditures as summarized in the table below in order to maintain and preserve the Company’s interests in the related mineral properties. If the Company is unable or unwilling to make any such payments or incur any such expenditures, it is likely that the Company would lose or forfeit its rights to acquire or hold the related mineral properties. The following table assumes that the Company retains the rights to all of its current mineral properties, but no other lease purchase or royalty buyout options: | |||||||||||||||||||||||
Payments Due by Year | |||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | 2020 and | Total | |||||||||||||||||
beyond | |||||||||||||||||||||||
Livengood Property Purchase(1) | $ | — | $ | — | $ | 14,700,000 | $ | — | $ | — | $ | — | $ | 14,700,000 | |||||||||
Mineral Property Leases(2) | 412,398 | 417,309 | 422,294 | 427,353 | 437,488 | 442,701 | 2,559,543 | ||||||||||||||||
Mining Claim Government Fees | 115,205 | 77,230 | 77,230 | 77,230 | 77,230 | 77,230 | 501,355 | ||||||||||||||||
Office and Equipment Lease Obligations | 86,584 | — | — | — | — | — | 86,584 | ||||||||||||||||
Total | $ | 614,187 | $ | 494,539 | $ | 15,199,524 | $ | 504,583 | $ | 514,718 | $ | 519,931 | $ | 17,847,482 | |||||||||
-1 | The amount payable in January 2017 of $14,700,000 represents the fair value of the Company’s derivative liability as at December 31, 2014 and will be revalued at each subsequent reporting period. See note 6. | ||||||||||||||||||||||
-2 | Does not include required work expenditures, as it is assumed that the required expenditure level is significantly below the work for which will actually be carried out by the Company. Does not include potential royalties that may be payable (other than annual minimum royalty payments). See note 4. | ||||||||||||||||||||||
SUPPLEMENTAL_CASH_FLOW_INFORMA
SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
SUPPLEMENTAL CASH FLOW INFORMATION | |||||||||||
SUPPLEMENTAL CASH FLOW INFORMATION | 11.SUPPLEMENTAL CASH FLOW INFORMATION | ||||||||||
December 31, | December 31, | December 31, | |||||||||
2014 | 2013 | 2012 | |||||||||
Income taxes paid | $ | — | $ | — | $ | 150,607 | |||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Basis of presentation | Basis of presentation | |||
These consolidated financial statements are presented in United States dollars and have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). | ||||
Basis of consolidation | Basis of consolidation | |||
These consolidated financial statements include the accounts of ITH and its wholly owned subsidiaries TH Alaska, TH US, LPI and 813034 Alberta Ltd. All intercompany transactions and balances have been eliminated. | ||||
Significant judgments, estimates and assumptions | Significant judgments, estimates and assumptions | |||
The preparation of financial statements in accordance with U.S. GAAP requires management to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the period. These judgments, estimates and assumptions are regularly evaluated and are based on management’s experience and knowledge of the relevant facts and circumstances. While management believes the estimates to be reasonable, actual results could differ from those estimates and could impact future results of operations and cash flows. | ||||
The areas which require significant judgment and estimates that management has made at the financial reporting date, that could result in a material change to the carrying amounts of assets and liabilities, in the event actual results differ from the assumptions made, relate to, but are not limited to the following: | ||||
Significant estimates | ||||
· | the fair value determination and inputs used in the valuation of the derivative liability (see note 6). | |||
Significant judgments | ||||
· | the determination of functional currencies; | |||
· | quantitative and qualitative factors used in the assessment of impairment of the Company’s capitalized acquisition costs; and | |||
· | the analysis of resource calculations, drill results, labwork, etc. which can impact the Company’s assessment of impairments, and provisions, if any, for environmental rehabilitation and restoration. | |||
Cash and cash equivalents | Cash and cash equivalents | |||
Cash equivalents include highly liquid investments with original maturities of three months or less, and which are subject to an insignificant risk of change in value. Cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. | ||||
Marketable securities | Marketable securities | |||
Marketable securities held in companies with an active market are classified as available-for-sale securities. Available-for-sale securities are recorded at fair value in the financial statements with unrealized gains and losses recorded in accumulated other comprehensive income. Accumulated unrealized gains and losses are recognized in the statement of operations upon the sale of the security or if the security is determined to be impaired. | ||||
Property and equipment | Property and equipment | |||
On initial recognition, property and equipment are valued at cost. Property and equipment is subsequently measured at cost less accumulated depreciation, less any accumulated impairment losses, with the exception of land which is not depreciated. Depreciation is recorded over the estimated useful life of the assets at the following annual rates: | ||||
Computer equipment - 30% declining balance; | ||||
Computer software - 3 years straight line; | ||||
Furniture and equipment -20% declining balance; and | ||||
Leasehold improvements - straight-line over the lease term. | ||||
Additions during the year are depreciated at one-half the annual rates. Depreciation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate. | ||||
Mineral properties and exploration and evaluation expenditures | Mineral properties and exploration and evaluation expenditures | |||
The Company’s mineral project is currently in the exploration and evaluation phase. Mineral property acquisition costs are capitalized when incurred. Mineral property exploration costs are expensed as incurred. At such time that the Company determines that a mineral property can be economically developed, subsequent mineral property expenses will be capitalized during the development of such property. | ||||
The Company assesses interests in exploration properties for impairment when facts and circumstances suggest that the carrying amount of an asset may exceed its recoverable amount. Impairment analysis includes assessment of the following circumstances: a significant decrease in the market price of a long-lived asset or asset group; a significant adverse change in the extent or manner in which a long-lived asset or asset group is being used or in its physical condition; a significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset or asset group, including an adverse action or assessment by a regulator; an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset or asset group; a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset or asset group; a current expectation that, more likely than not, a long-lived asset or asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. The term more likely than not refers to a level of likelihood that is more than 50%. | ||||
The Company’s assessment of impairment related to its capitalized acquisition costs at December 31, 2014 was based on estimated undiscounted future cash flows expected to result from the use and eventual disposition of these assets. The assessment took into account the Company’s expectation for the future price of gold as well as the probability of achieving certain opportunities to enhance the economics of the Livengood Gold Project as set out in the September 2013 Study and as subsequently developed by the Company. Based on this assessment, no impairments were recorded at December 31, 2014. | ||||
Asset retirement obligations | Asset retirement obligations | |||
The Company records a liability based on the best estimate of costs for site closure and reclamation activities that the Company is legally or contractually required to remediate and recorded at the time environmental disturbance occurs. The provision for closure and reclamation liabilities is estimated using expected cash flows based on engineering and environmental reports and accreted to full value over time through periodic charges to income. The Company does not have any material provisions for environmental rehabilitation as of December 31, 2014. | ||||
Derivatives | Derivatives | |||
Derivative financial liabilities include the Company’s future contingent mineral property payment valued using estimated future gold prices. Derivatives are initially recognized at their fair value on the date the derivative contract is entered into and are subsequently re-measured at their fair value at each reporting period with changes in the fair value recognized in the statement of operations. | ||||
Income taxes | Income taxes | |||
The Company accounts for income taxes under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under the asset and liability method, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recognized if it is more likely than not that some portion or the entire deferred tax asset will not be recognized. | ||||
Net loss per share | Net loss per share | |||
Basic loss per share is calculated using the weighted average number of common shares outstanding during the period. Diluted loss per share reflects the potential dilution that could occur if securities or contracts that may require the issuance of common shares in the future were converted, unless the impact is anti-dilutive. | ||||
Stock-based compensation | Stock-based compensation | |||
The Company follows the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Section 718 “Compensation - Stock Compensation”, which establishes accounting for equity based compensation awards to be accounted for using the fair value method. The Company uses the Black-Scholes option pricing model to determine the grant date fair value of the awards. Compensation expense is measured at the grant date and recognized over the requisite service period, which is generally the vesting period. | ||||
Recently issued and adopted accounting pronouncements | Recently Issued Accounting Pronouncements | |||
In June 2014, the FASB issued Accounting Standards Update 2014-12, Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (“ASU 2014-12”). The amendments in ASU 2014-12 require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in ASC 718, as it relates to awards with performance conditions that affect vesting to account for such awards. The amendments in ASU 2014-12 are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Early adoption is permitted. The adoption of ASU 2014-12 is not expected to have a material impact on our financial position, results of operations or cash flows. | ||||
Recently Adopted Accounting Pronouncements | ||||
In June 2014, the FASB issued Accounting Standards Update 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements (“ASU 2014-10”). ASU 2014-10 eliminates the distinction of a development stage entity and certain related disclosure requirements, including the elimination of inception-to-date information on the statements of operations, cash flows and stockholders’ equity. The amendments in ASU 2014-10 are effective for annual reporting periods beginning after December 15, 2014, and interim periods within those annual periods. Early adoption of this standard is permitted and the Company adopted the provisions of ASU 2014-10 during the quarter ended June 30, 2014. The adoption of ASU 2014-10 impacts the presentation of the statements of operations and comprehensive income and the statements of cash flows as these statements no longer contain financial information from the inception of the Company to the date of the financial statements. | ||||
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | ||||||||
Schedule of fair value of financial instruments | ||||||||
Fair value as at December 31, 2014 | ||||||||
Level 1 | Level 2 | |||||||
Financial assets: | ||||||||
Marketable securities | $ | 26,894 | $ | — | ||||
$ | 26,894 | $ | — | |||||
Financial liabilities: | ||||||||
Derivative liability (note 6) | $ | — | $ | 14,700,000 | ||||
$ | — | $ | 14,700,000 | |||||
Fair value as at December 31, 2013 | ||||||||
Level 1 | Level 2 | |||||||
Financial assets: | ||||||||
Marketable securities | $ | 55,002 | $ | — | ||||
$ | 55,002 | $ | — | |||||
Financial liabilities: | ||||||||
Derivative liability (note 6) | $ | — | $ | 14,800,000 | ||||
$ | — | $ | 14,800,000 | |||||
CAPITALIZED_ACQUISITION_COSTS_
CAPITALIZED ACQUISITION COSTS (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
CAPITALIZED ACQUISITION COSTS | ||||||||
Schedule of activity related to capitalized acquisition costs | ||||||||
Capitalized acquisition costs | Amount | |||||||
Balance, December 31, 2013 | $ | 55,173,564 | ||||||
Additions | 30,477 | |||||||
Balance, December 31, 2014 | $ | 55,204,041 | ||||||
Schedule presenting costs incurred for exploration and evaluation activities | ||||||||
Year ended | Year ended | |||||||
December 31, 2014 | December 31, 2013 | |||||||
Exploration costs: | ||||||||
Aircraft services | $ | 10,286 | $ | 68,577 | ||||
Assay | 8,163 | 21,712 | ||||||
Drilling | 119,036 | 451,286 | ||||||
Environmental | 1,201,642 | 2,235,287 | ||||||
Equipment rental | 52,709 | 344,063 | ||||||
Field costs | 211,848 | 825,642 | ||||||
Geological/geophysical | 70,388 | 3,367,799 | ||||||
Land maintenance & tenure | 530,543 | 470,489 | ||||||
Legal | 367,556 | 256,965 | ||||||
Surveying and mapping | 26,503 | 95,638 | ||||||
Transportation and travel | 33,300 | 51,537 | ||||||
Total expenditures for the period | $ | 2,631,974 | $ | 8,188,995 | ||||
ACCRUED_LIABILITIES_Tables
ACCRUED LIABILITIES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
ACCRUED LIABILITIES | ||||||||
Schedule of accrued liabilities | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Accrued liabilities | $ | 334,423 | $ | 540,486 | ||||
Accrued severance | 390,659 | 719,375 | ||||||
Accrued salaries and benefits | 153,600 | 191,366 | ||||||
Total accrued liabilities | $ | 878,682 | $ | 1,451,227 | ||||
DERIVATIVE_LIABILITY_Tables
DERIVATIVE LIABILITY (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
DERIVATIVE LIABILITY | ||||||||
Schedule of fair value of the derivative liability and the estimated Average Gold Price | ||||||||
Fair value | Average Gold | |||||||
Price/oz. | ||||||||
Derivative value at December 31, 2012 | $ | 22,400,000 | $ | 1,688 | ||||
Unrealized gain for the year | (7,600,000 | ) | ||||||
Derivative value at December 31, 2013 | 14,800,000 | $ | 1,360 | |||||
Unrealized gain for the year | (100,000 | ) | ||||||
Derivative value at December 31, 2014 | $ | 14,700,000 | $ | 1,356 | ||||
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
INCOME TAXES | ||||||||
Schedule of reconciliation of income taxes at statutory rates with the reported taxes | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Loss before income taxes | $ | (7,767,096 | ) | $ | (9,852,480 | ) | ||
Statutory Canadian corporate tax rate | 25 | % | 25 | % | ||||
Income tax recovery at statutory rates | $ | (1,941,774 | ) | $ | (2,463,120 | ) | ||
Share-based payments | 321,346 | 891,068 | ||||||
Unrecognized items for tax purposes | (5,383 | ) | (1,634,335 | ) | ||||
Difference in tax rates in other jurisdictions | (1,072,910 | ) | (1,036,959 | ) | ||||
Unrecognized amounts | 2,698,721 | 4,243,346 | ||||||
Income tax recovery | $ | — | $ | — | ||||
Schedule of significant components of the Company's deferred income tax assets and liabilities | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Deferred income tax assets (liabilities): | ||||||||
Mineral properties | $ | 57,243,322 | $ | 57,243,322 | ||||
Derivative liability | (1,822,800 | ) | (1,801,100 | ) | ||||
Other | 62,329 | 63,539 | ||||||
Share issue costs | 148,685 | 409,503 | ||||||
Non-capital losses available for future periods | 31,229,931 | 28,245,574 | ||||||
86,861,467 | 84,160,838 | |||||||
Valuation allowance | (86,861,467 | ) | (84,160,838 | ) | ||||
Deferred income tax asset | $ | — | $ | — | ||||
Schedule of expiration year of available net loss carryforward | ||||||||
Canada | United States | |||||||
2025 | $ | 65,000 | $ | — | ||||
2026 | 78,000 | — | ||||||
2027 | 907,000 | 1,252,000 | ||||||
2028 | 1,253,000 | 1,350,000 | ||||||
2029 | 2,074,000 | 2,600,000 | ||||||
2030 | 2,829,000 | 5,691,000 | ||||||
2031 | 4,180,000 | 14,730,000 | ||||||
2032 | 2,629,000 | 18,371,000 | ||||||
2033 | 1,827,000 | 11,962,000 | ||||||
2034 | 1,694,000 | 5,901,000 | ||||||
17,536,000 | 61,857,000 | |||||||
SHARE_CAPITAL_Tables
SHARE CAPITAL (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
SHARE CAPITAL | ||||||||||||||||
Summary of the status of the stock option plan and changes therein | ||||||||||||||||
Year Ended | Year Ended | |||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||
Number of | Weighted | Number of | Weighted | |||||||||||||
Options | Average Exercise | Options | Average Exercise | |||||||||||||
Price (C$) | Price (C$) | |||||||||||||||
Balance, beginning of the period | 5,493,000 | $ | 3.57 | 8,570,000 | $ | 4.73 | ||||||||||
Granted | 2,480,000 | $ | 1 | 613,000 | $ | 2.18 | ||||||||||
Expired | — | $ | — | (1,040,000 | ) | $ | 7.78 | |||||||||
Forfeited | (600,000 | ) | $ | 3.17 | (1,550,000 | ) | $ | 3.27 | ||||||||
Cancelled | (1,519,000 | ) | $ | 2.97 | (1,100,000 | ) | $ | 8.27 | ||||||||
Balance, end of the period | 5,854,000 | $ | 2.68 | 5,493,000 | $ | 3.57 | ||||||||||
Schedule of stock options outstanding by exercise price | ||||||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||||||
Expiry Date | Exercise | Number of | Exercisable | Exercise | Number of | Exercisable | ||||||||||
Price (C$) | Options | Price (C$) | Options | |||||||||||||
August 23, 2016 | $ | 8.07 | 600,000 | 600,000 | $ | 8.07 | 600,000 | 600,000 | ||||||||
January 9, 2017 | $ | 4.60 | 30,000 | 30,000 | $ | 4.60 | 30,000 | 20,000 | ||||||||
August 24, 2017 | $ | 3.17 | 2,275,000 | 2,275,000 | $ | 3.17 | 3,350,000 | 2,233,322 | ||||||||
September 19, 2017 | — | — | — | $ | 2.91 | 1,000,000 | 666,666 | |||||||||
March 14, 2018 | $ | 2.18 | 469,000 | 312,660 | $ | 2.18 | 513,000 | 170,995 | ||||||||
February 25, 2022 | $ | 1.11 | 1,360,000 | 453,333 | — | — | — | |||||||||
February 25, 2022 | $ | 0.73 | 690,000 | 230,000 | — | — | — | |||||||||
March 10, 2022 | $ | 1.11 | 430,000 | 143,333 | — | — | — | |||||||||
5,854,000 | 4,044,326 | 5,493,000 | 3,690,983 | |||||||||||||
Summary of the non-vested options and changes | ||||||||||||||||
Non-vested options: | Number of | Weighted | ||||||||||||||
options | average grant- | |||||||||||||||
date fair value | ||||||||||||||||
(C$) | ||||||||||||||||
Outstanding at December 31, 2012 | 4,386,680 | $ | 2.05 | |||||||||||||
Granted | 613,000 | $ | 0.5 | |||||||||||||
Vested | (2,547,660 | ) | $ | 2.27 | ||||||||||||
Forfeited | (650,003 | ) | $ | 1.57 | ||||||||||||
Outstanding at December 31, 2013 | 1,802,017 | $ | 1.38 | |||||||||||||
Granted | 2,480,000 | $ | 0.49 | |||||||||||||
Vested | (2,272,342 | ) | $ | 1.1 | ||||||||||||
Forfeited | (200,001 | ) | $ | 1.61 | ||||||||||||
Outstanding at December 31, 2014 | 1,809,674 | $ | 0.49 | |||||||||||||
Schedule of weighted average assumptions as used for Black-Scholes option pricing model calculations | ||||||||||||||||
Year ended | Year ended | |||||||||||||||
December 31, | December 31, | |||||||||||||||
2014 | 2013 | |||||||||||||||
Expected life of options | 6 years | 4 years | ||||||||||||||
Risk-free interest rate | 1.83 | % | 1.29 | % | ||||||||||||
Expected volatility | 81.02 | % | 59.48 | % | ||||||||||||
Dividend rate | 0.00 | % | 0.00 | % | ||||||||||||
Exercise price (C$) | $ | 1.00 | $ | 2.18 | ||||||||||||
SEGMENT_AND_GEOGRAPHIC_INFORMA1
SEGMENT AND GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
SEGMENT AND GEOGRAPHIC INFORMATION | |||||||||||
Schedule of selected financial information by geographic location | |||||||||||
Canada | United States | Total | |||||||||
December 31, 2014 | |||||||||||
Capitalized acquisition costs | $ | — | $ | 55,204,041 | $ | 55,204,041 | |||||
Property and equipment | 10,477 | 26,651 | 37,128 | ||||||||
Current assets | 13,003,412 | 760,119 | 13,763,531 | ||||||||
Total assets | $ | 13,013,889 | $ | 55,990,811 | $ | 69,004,700 | |||||
December 31, 2013 | |||||||||||
Capitalized acquisition costs | $ | — | $ | 55,173,564 | $ | 55,173,564 | |||||
Restricted cash | — | 30,477 | 30,477 | ||||||||
Property and equipment | 11,994 | 55,919 | 67,913 | ||||||||
Current assets | 13,289,752 | 903,171 | 14,192,923 | ||||||||
Total assets | $ | 13,301,746 | $ | 56,163,131 | $ | 69,464,877 | |||||
Year ended | Year ended | Year ended | |||||||||
December 31, | December 31, | December 31, | |||||||||
2014 | 2013 | 2012 | |||||||||
Net loss for the period - Canada | $ | (1,936,065 | ) | $ | (4,216,835 | ) | $ | (10,589,464 | ) | ||
Net loss for the period - United States | (5,831,031 | ) | (5,635,645 | ) | (46,053,998 | ) | |||||
Net loss for the period | $ | (7,767,096 | ) | $ | (9,852,480 | ) | $ | (56,643,462 | ) | ||
COMMITMENTS_Tables
COMMITMENTS (Tables) | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||
COMMITMENTS | |||||||||||||||||||||||
Schedule of contractual obligations | |||||||||||||||||||||||
Payments Due by Year | |||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | 2020 and | Total | |||||||||||||||||
beyond | |||||||||||||||||||||||
Livengood Property Purchase(1) | $ | — | $ | — | $ | 14,700,000 | $ | — | $ | — | $ | — | $ | 14,700,000 | |||||||||
Mineral Property Leases(2) | 412,398 | 417,309 | 422,294 | 427,353 | 437,488 | 442,701 | 2,559,543 | ||||||||||||||||
Mining Claim Government Fees | 115,205 | 77,230 | 77,230 | 77,230 | 77,230 | 77,230 | 501,355 | ||||||||||||||||
Office and Equipment Lease Obligations | 86,584 | — | — | — | — | — | 86,584 | ||||||||||||||||
Total | $ | 614,187 | $ | 494,539 | $ | 15,199,524 | $ | 504,583 | $ | 514,718 | $ | 519,931 | $ | 17,847,482 | |||||||||
-1 | The amount payable in January 2017 of $14,700,000 represents the fair value of the Company’s derivative liability as at December 31, 2014 and will be revalued at each subsequent reporting period. See note 6. | ||||||||||||||||||||||
-2 | Does not include required work expenditures, as it is assumed that the required expenditure level is significantly below the work for which will actually be carried out by the Company. Does not include potential royalties that may be payable (other than annual minimum royalty payments). See note 4. | ||||||||||||||||||||||
SUPPLEMENTAL_CASH_FLOW_INFORMA1
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
SUPPLEMENTAL CASH FLOW INFORMATION | |||||||||||
Schedule of supplemental cash flow information | |||||||||||
December 31, | December 31, | December 31, | |||||||||
2014 | 2013 | 2012 | |||||||||
Income taxes paid | $ | — | $ | — | $ | 150,607 | |||||
GENERAL_INFORMATION_NATURE_AND1
GENERAL INFORMATION, NATURE AND CONTINUANCE OF OPERATIONS (Details) (Livengood Property) | Dec. 31, 2014 |
Livengood Property | |
GENERAL INFORMATION, NATURE AND CONTINUANCE OF OPERATIONS | |
Controlling interest in Livengood Gold Project in Alaska, U.S.A. (as a percent) | 100.00% |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Mineral properties and exploration and evaluation expenditures | |
Impairment of capitalized acquisition costs | $0 |
Computer equipment | |
Property and equipment | |
Annual depreciation rate | 30% declining balance |
Computer software | |
Property and equipment | |
Annual depreciation rate | 3 years straight line |
Furniture and equipments | |
Property and equipment | |
Annual depreciation rate | 20% declining balance |
Leasehold improvements | |
Property and equipment | |
Annual depreciation rate | straight-line over the lease term |
FAIR_VALUE_OF_FINANCIAL_INSTRU2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) (Recurring, USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Level 1 | ||
Financial assets: | ||
Marketable securities | $26,894 | $55,002 |
Total | 26,894 | 55,002 |
Level 2 | ||
Financial liabilities: | ||
Derivative liability | 14,700,000 | 14,800,000 |
Total | $14,700,000 | $14,800,000 |
CAPITALIZED_ACQUISITION_COSTS_1
CAPITALIZED ACQUISITION COSTS (Details) | 3 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 0 Months Ended | |||||||||||||||||||||
Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Jul. 26, 2007 | Aug. 04, 2006 | Jun. 30, 2006 | Dec. 11, 2014 | Jul. 26, 2007 | Aug. 04, 2006 | |
USD ($) | USD ($) | USD ($) | USD ($) | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | Livengood Property | AngloGold | AngloGold | AngloGold | AngloGold | AngloGold | AngloGold | |
Alaska Mental Health Trust mineral rights | Alaska Mental Health Trust mineral rights | Alaska Mental Health Trust mineral rights | Federal unpatented lode mining | Federal unpatented lode mining | Federal unpatented lode mining | Federal unpatented lode mining | Federal unpatented lode mining | Patented lode claims | Patented lode claims | Patented lode claims | Unpatented federal lode mining and federal unpatented placer claims | Unpatented federal lode mining and federal unpatented placer claims | Unpatented federal lode mining and federal unpatented placer claims | Unpatented federal lode mining and federal unpatented placer claims | Unpatented federal lode mining and federal unpatented placer claims | Unpatented federal lode mining and federal unpatented placer claims | CAD | USD ($) | item | item | |||||||
USD ($) | Production royalty | Production royalty | USD ($) | Advance royalties | Production royalty | Production royalty | Production royalty | USD ($) | Advance royalties | Production royalty | USD ($) | Maximum | Advance royalties | Production royalty | Production royalty | Production royalty | |||||||||||
Minimum | Maximum | Minimum | USD ($) | Minimum | Maximum | Minimum | Minimum | USD ($) | Minimum | Maximum | |||||||||||||||||
USD ($) | USD ($) | USD ($) | |||||||||||||||||||||||||
Capitalized acquisition costs | |||||||||||||||||||||||||||
Balance, at the beginning of the period | $55,173,564 | ||||||||||||||||||||||||||
Acquisition costs | 30,477 | ||||||||||||||||||||||||||
Balance, at the end of the period | 55,204,041 | 55,204,041 | 55,173,564 | ||||||||||||||||||||||||
Exploration costs: | |||||||||||||||||||||||||||
Aircraft services | 10,286 | 68,577 | |||||||||||||||||||||||||
Assay | 8,163 | 21,712 | |||||||||||||||||||||||||
Drilling | 119,036 | 451,286 | |||||||||||||||||||||||||
Environmental | 1,201,642 | 2,235,287 | |||||||||||||||||||||||||
Equipment rental | 52,709 | 344,063 | |||||||||||||||||||||||||
Field costs | 211,848 | 825,642 | |||||||||||||||||||||||||
Geological/geophysical | 70,388 | 3,367,799 | |||||||||||||||||||||||||
Land maintenance & tenure | 530,543 | 470,489 | |||||||||||||||||||||||||
Legal | 367,556 | 256,965 | |||||||||||||||||||||||||
Surveying and mapping | 26,503 | 95,638 | |||||||||||||||||||||||||
Transportation and travel | 33,300 | 51,537 | |||||||||||||||||||||||||
Total expenditures for the period | 2,631,974 | 8,188,995 | 36,253,519 | ||||||||||||||||||||||||
Properties acquired from AngloGold, Alaska | |||||||||||||||||||||||||||
Number of mineral exploration projects | 7 | ||||||||||||||||||||||||||
Cash payment | 50,000 | ||||||||||||||||||||||||||
Shares issued | 5,997,295 | ||||||||||||||||||||||||||
Equity interest percentage in the entity by the acquired entity | 19.99% | ||||||||||||||||||||||||||
Number of private placement financings | 2 | ||||||||||||||||||||||||||
Proceeds from issuance of common shares | 7,315,917 | 7,315,917 | 29,768,529 | 11,479,348 | |||||||||||||||||||||||
Equity interest falling below specific percentage any time after January 1, 2009 resulting in termination of right to maintain equity interest percentage on an ongoing basis | 10.00% | ||||||||||||||||||||||||||
Period of right of first offer | 90 days | ||||||||||||||||||||||||||
Equity interest falling below specific percentage resulting in termination of right of first offer | 10.00% | 10.00% | |||||||||||||||||||||||||
Extended period of lease term | 19 years | ||||||||||||||||||||||||||
Flat annual fee (as a percent) | 125.00% | ||||||||||||||||||||||||||
Lease expenditures, additional disclosures | |||||||||||||||||||||||||||
Initial lease term | 10 years | 10 years | 10 years | ||||||||||||||||||||||||
NSR, based on price of gold, payable (as a percent) | 2.50% | 5.00% | 2.00% | 3.00% | 0.50% | 1.00% | |||||||||||||||||||||
NSR payable (as a percent) | 3.00% | 2.00% | |||||||||||||||||||||||||
Expenditure since inception of lease | 1,648,923 | 530,000 | 125,000 | 83,000 | |||||||||||||||||||||||
Lease expenditure due on or before each anniversary date of lease | 50,000 | 20,000 | 15,000 | ||||||||||||||||||||||||
Royalty to be purchased by the entity (as a percent) | 1.00% | ||||||||||||||||||||||||||
Purchase price payable for a portion of royalty | 1,000,000 | 1,000,000 | |||||||||||||||||||||||||
Lease expenditure due on or before each subsequent anniversary date of lease | 25,000 | ||||||||||||||||||||||||||
Purchase price payable for purchase of all interests of the lessors in the leased property | 1,000,000 | ||||||||||||||||||||||||||
Portion of purchase price for purchase of all interests of the lessors in the leased property, payable in cash | 500,000 | ||||||||||||||||||||||||||
Period over which the cash purchase price for purchase of all interests of the lessors in the leased property is payable | 4 years | ||||||||||||||||||||||||||
Balance of purchase price for purchase of all interests of the lessors in the leased property, payable by way of NSR production royalty | 500,000 | ||||||||||||||||||||||||||
NSR production royalty base for payments for acquisition of mining interest (as a percent) | 3.00% | ||||||||||||||||||||||||||
Amount payable to lessor on positive production decision | 250,000 | ||||||||||||||||||||||||||
Portion of amount payable to lessor on positive production decision | 125,000 | ||||||||||||||||||||||||||
Balance amount payable to lessor on positive production decision | $125,000 | ||||||||||||||||||||||||||
Prescribed period for payment of the first half portion to lessor on positive production decision | 120 days |
ACCRUED_LIABILITIES_Details
ACCRUED LIABILITIES (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Accrued liabilities | ||
Accrued liabilities | $334,423 | $540,486 |
Accrued severance | 390,659 | 719,375 |
Accrued salaries and benefits | 153,600 | 191,366 |
Total accrued liabilities | 878,682 | 1,451,227 |
General corporate costs | 74,413 | 115,020 |
Project costs | $260,010 | $425,466 |
DERIVATIVE_LIABILITY_Details
DERIVATIVE LIABILITY (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
DERIVATIVE LIABILITY | ||||
Derivative liability, value on initial recognition | $23,100,000 | |||
Period for projecting gold prices | 5 years | |||
Average Gold Price (in dollars per ounce of gold) | 1,356 | 1,360 | 1,688 | |
Fair value of the derivative liability | ||||
Derivative value at beginning of the period | 14,800,000 | 22,400,000 | ||
Unrealized (gain) loss on derivative liability | -100,000 | -7,600,000 | 1,600,000 | |
Derivative value at end of the period | 14,700,000 | 14,800,000 | 22,400,000 | |
Livengood Gold Project, Alaska | ||||
DERIVATIVE LIABILITY - Livengood Gold Project | ||||
Aggregate consideration for the claims and rights in cash | 13,500,000 | |||
Basis period of average gold price per ounce of gold is considered for calculating additional contingent payment | 5 years | |||
Contingent payment equivalent for every dollar in excess of specified average gold price per troy ounce | 23,148 | |||
Average Gold Price (in dollars per troy ounce) | 720 | |||
Additional contingent payment, if the average Gold Price is less than specified price per troy ounce | $0 |
INCOME_TAXES_Details
INCOME TAXES (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Reconciliation of income taxes at statutory rates with the reported taxes | ||
Loss before income taxes | ($7,767,096) | ($9,852,480) |
Statutory Canadian corporate tax rate (as a percent) | 25.00% | 25.00% |
Income tax recovery at statutory rates | -1,941,774 | -2,463,120 |
Share-based payments | 321,346 | 891,068 |
Unrecognized items for tax purposes | -5,383 | -1,634,335 |
Difference in tax rates in other jurisdictions | -1,072,910 | -1,036,959 |
Unrecognized amounts | 2,698,721 | 4,243,346 |
Deferred income tax assets (liabilities): | ||
Mineral properties | 57,243,322 | 57,243,322 |
Derivative liability | -1,822,800 | -1,801,100 |
Other | 62,329 | 63,539 |
Share issue costs | 148,685 | 409,503 |
Non-capital losses available for future periods | 31,229,931 | 28,245,574 |
Deferred income tax asset before valuation | 86,861,467 | 84,160,838 |
Valuation allowance | ($86,861,467) | ($84,160,838) |
INCOME_TAXES_Details_2
INCOME TAXES (Details 2) (USD $) | Dec. 31, 2014 |
Net operating losses | |
Net operating losses carry-forward | $17,536,000 |
Canada | |
Net operating losses | |
Net operating losses carry-forward | 17,536,000 |
Amount of mineral resource related expenditure pools available for carryforward | 2,628,000 |
Canada | 2025 | |
Net operating losses | |
Net operating losses carry-forward | 65,000 |
Canada | 2026 | |
Net operating losses | |
Net operating losses carry-forward | 78,000 |
Canada | 2027 | |
Net operating losses | |
Net operating losses carry-forward | 907,000 |
Canada | 2028 | |
Net operating losses | |
Net operating losses carry-forward | 1,253,000 |
Canada | 2029 | |
Net operating losses | |
Net operating losses carry-forward | 2,074,000 |
Canada | 2030 | |
Net operating losses | |
Net operating losses carry-forward | 2,829,000 |
Canada | 2031 | |
Net operating losses | |
Net operating losses carry-forward | 4,180,000 |
Canada | 2032 | |
Net operating losses | |
Net operating losses carry-forward | 2,629,000 |
Canada | 2033 | |
Net operating losses | |
Net operating losses carry-forward | 1,827,000 |
Canada | 2034 | |
Net operating losses | |
Net operating losses carry-forward | 1,694,000 |
United States | |
Net operating losses | |
Net operating losses carry-forward | 61,857,000 |
Amount of mineral resource related expenditure pools available for carryforward | 185,999,000 |
United States | 2027 | |
Net operating losses | |
Net operating losses carry-forward | 1,252,000 |
United States | 2028 | |
Net operating losses | |
Net operating losses carry-forward | 1,350,000 |
United States | 2029 | |
Net operating losses | |
Net operating losses carry-forward | 2,600,000 |
United States | 2030 | |
Net operating losses | |
Net operating losses carry-forward | 5,691,000 |
United States | 2031 | |
Net operating losses | |
Net operating losses carry-forward | 14,730,000 |
United States | 2032 | |
Net operating losses | |
Net operating losses carry-forward | 18,371,000 |
United States | 2033 | |
Net operating losses | |
Net operating losses carry-forward | 11,962,000 |
United States | 2034 | |
Net operating losses | |
Net operating losses carry-forward | $5,901,000 |
SHARE_CAPITAL_Details
SHARE CAPITAL (Details) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | |
USD ($) | USD ($) | CAD | CAD | USD ($) | On the date of grant | On the date of grant | First anniversary | First anniversary | Maximum | |
Authorized | ||||||||||
Authorized common shares without par value | 500,000,000 | 500,000,000 | 500,000,000 | |||||||
Share capital, shares issued | 116,313,638 | 116,313,638 | 98,068,638 | |||||||
Share capital, shares outstanding | 116,313,638 | 116,313,638 | 98,068,638 | |||||||
Share issuances | ||||||||||
Issuance of common shares | 18,245,000 | |||||||||
Price per share (in Canadian dollars per share) | 0.46 | |||||||||
Proceeds from issuance of common shares | $7,315,917 | $7,315,917 | $29,768,529 | |||||||
Share issuance costs for non-brokered private placement financing | $24,828 | $554,280 | ||||||||
Share Capital | ||||||||||
Aggregate common shares of capital stock made issuable pursuant to options granted under the 2006 Plan (as a percent) | 10.00% | |||||||||
Option term | 10 years | |||||||||
Vesting percentage | 33.00% | 33.00% | 33.00% | 33.00% | ||||||
Number of Options | ||||||||||
Balance, beginning of the period (in shares) | 5,493,000 | 5,493,000 | 8,570,000 | |||||||
Granted (in shares) | 2,480,000 | 2,480,000 | 613,000 | |||||||
Expired (in shares) | -1,040,000 | |||||||||
Forfeited (in shares) | -600,000 | -600,000 | -1,550,000 | |||||||
Cancelled (in shares) | -1,519,000 | -1,519,000 | -1,100,000 | |||||||
Balance, end of the period (in shares) | 5,854,000 | 5,854,000 | 5,493,000 | |||||||
Weighted Average Exercise Price | ||||||||||
Balance, beginning of the period (in Canadian dollars per share) | 3.57 | 4.73 | ||||||||
Granted (in Canadian dollars per share) | 1 | 2.18 | ||||||||
Expired (in Canadian dollars per share) | 7.78 | |||||||||
Forfeited (in Canadian dollars per share) | 3.17 | 3.27 | ||||||||
Cancelled (in Canadian dollars per share) | 2.97 | 8.27 | ||||||||
Balance, end of the period (in Canadian dollars per share) | 2.68 | 3.57 | ||||||||
Additional disclosure | ||||||||||
Weighted average remaining life of options | 4 years 6 months | 4 years 6 months |
SHARE_CAPITAL_Details_2
SHARE CAPITAL (Details 2) (CAD) | Dec. 31, 2014 | Dec. 31, 2013 |
Stock options outstanding | ||
Number of Options (in shares) | 5,854,000 | 5,493,000 |
Exercisable (in shares) | 4,044,326 | 3,690,983 |
Exercise Price $ 8.07 | ||
Stock options outstanding | ||
Exercise Price (in Canadian dollars per share) | 8.07 | 8.07 |
Number of Options (in shares) | 600,000 | 600,000 |
Exercisable (in shares) | 600,000 | 600,000 |
Exercise Price $ 4.60 | ||
Stock options outstanding | ||
Exercise Price (in Canadian dollars per share) | 4.6 | 4.6 |
Number of Options (in shares) | 30,000 | 30,000 |
Exercisable (in shares) | 30,000 | 20,000 |
Exercise Price $ 3.17 | ||
Stock options outstanding | ||
Exercise Price (in Canadian dollars per share) | 3.17 | 3.17 |
Number of Options (in shares) | 2,275,000 | 3,350,000 |
Exercisable (in shares) | 2,275,000 | 2,233,322 |
Exercise Price $ 2.91 | ||
Stock options outstanding | ||
Exercise Price (in Canadian dollars per share) | 2.91 | |
Number of Options (in shares) | 1,000,000 | |
Exercisable (in shares) | 666,666 | |
Exercise Price $ 2.18 | ||
Stock options outstanding | ||
Exercise Price (in Canadian dollars per share) | 2.18 | 2.18 |
Number of Options (in shares) | 469,000 | 513,000 |
Exercisable (in shares) | 312,660 | 170,995 |
Exercise Price $ 1.11 | ||
Stock options outstanding | ||
Exercise Price (in Canadian dollars per share) | 1.11 | |
Number of Options (in shares) | 1,360,000 | |
Exercisable (in shares) | 453,333 | |
Exercise Price $ 0.73 | ||
Stock options outstanding | ||
Exercise Price (in Canadian dollars per share) | 0.73 | |
Number of Options (in shares) | 690,000 | |
Exercisable (in shares) | 230,000 | |
Exercise Price $ 1.11 | ||
Stock options outstanding | ||
Exercise Price (in Canadian dollars per share) | 1.11 | |
Number of Options (in shares) | 430,000 | |
Exercisable (in shares) | 143,333 |
SHARE_CAPITAL_Details_3
SHARE CAPITAL (Details 3) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | |
USD ($) | CAD | USD ($) | CAD | USD ($) | |
Number of options | |||||
Outstanding at the beginning of the period (in shares) | 1,802,017 | 1,802,017 | 4,386,680 | 4,386,680 | |
Granted (in shares) | 2,480,000 | 2,480,000 | 613,000 | 613,000 | |
Vested (in shares) | -2,272,342 | -2,272,342 | -2,547,660 | -2,547,660 | |
Forfeited (in shares) | -200,001 | -200,001 | -650,003 | -650,003 | |
Outstanding at the end of the period (in shares) | 1,809,674 | 1,809,674 | 1,802,017 | 1,802,017 | |
Weighted average grant-date fair value | |||||
Outstanding at the beginning of the period (in Canadian dollars per share) | 1.38 | 2.05 | |||
Granted (in Canadian dollars per share) | 0.49 | 0.5 | |||
Vested (in Canadian dollars per share) | 1.1 | 2.27 | |||
Forfeited (in Canadian dollars per share) | 1.61 | 1.57 | |||
Outstanding at the end of the period (in Canadian dollars per share) | 0.49 | 1.38 | |||
Non-vested options: Additional disclosure | |||||
Unrecognized compensation expense | 308,850 | ||||
Weighted-average remaining period over which unrecognized compensation expense cost is expected to be recognized | 11 months 5 days | 11 months 5 days | |||
Share-based payments | |||||
Options granted during the period (in shares) | 2,480,000 | 2,480,000 | 613,000 | 613,000 | |
Fair value of the option granted (in Canadian dollars) | 1,224,537 | ||||
Share-based payment charges | $1,285,385 | $3,564,273 | $9,206,975 | ||
Weighted average assumptions as used for Black-Scholes option pricing model calculations | |||||
Expected life of options | 6 years | 6 years | 4 years | 4 years | |
Risk-free interest rate (as a percent) | 1.83% | 1.83% | 1.29% | 1.29% | |
Expected volatility (as a percent) | 81.02% | 81.02% | 59.48% | 59.48% | |
Dividend rate (as a percent) | 0.00% | 0.00% | 0.00% | 0.00% | |
Exercise price (in Canadian dollars per share) | 1 | 2.18 |
SEGMENT_AND_GEOGRAPHIC_INFORMA2
SEGMENT AND GEOGRAPHIC INFORMATION (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
SEGMENTED INFORMATION | |||
Capitalized acquisition costs | $55,204,041 | $55,173,564 | |
Restricted cash | 30,477 | ||
Property and equipment | 37,128 | 67,913 | |
Current assets | 13,763,531 | 14,192,923 | |
Total assets | 69,004,700 | 69,464,877 | |
Net loss for the period | -7,767,096 | -9,852,480 | -56,643,462 |
Canada. | |||
SEGMENTED INFORMATION | |||
Property and equipment | 10,477 | 11,994 | |
Current assets | 13,003,412 | 13,289,752 | |
Total assets | 13,013,889 | 13,301,746 | |
Net loss for the period | -1,936,065 | -4,216,835 | -10,589,464 |
United States. | |||
SEGMENTED INFORMATION | |||
Capitalized acquisition costs | 55,204,041 | 55,173,564 | |
Restricted cash | 30,477 | ||
Property and equipment | 26,651 | 55,919 | |
Current assets | 760,119 | 903,171 | |
Total assets | 55,990,811 | 56,163,131 | |
Net loss for the period | ($5,831,031) | ($5,635,645) | ($46,053,998) |
COMMITMENTS_Details
COMMITMENTS (Details) (USD $) | Dec. 31, 2014 |
Payments Due by Year | |
2015 | $614,187 |
2016 | 494,539 |
2017 | 15,199,524 |
2018 | 504,583 |
2019 | 514,718 |
2020 and beyond | 519,931 |
Total | 17,847,482 |
Livengood Property Purchase | |
Payments Due by Year | |
2017 | 14,700,000 |
Total | 14,700,000 |
Mineral Property Leases | |
Payments Due by Year | |
2015 | 412,398 |
2016 | 417,309 |
2017 | 422,294 |
2018 | 427,353 |
2019 | 437,488 |
2020 and beyond | 442,701 |
Total | 2,559,543 |
Mining Claim Government Fees | |
Payments Due by Year | |
2015 | 115,205 |
2016 | 77,230 |
2017 | 77,230 |
2018 | 77,230 |
2019 | 77,230 |
2020 and beyond | 77,230 |
Total | 501,355 |
Office and Equipment Lease Obligation | |
Payments Due by Year | |
2015 | 86,584 |
Total | $86,584 |
SUPPLEMENTAL_CASH_FLOW_INFORMA2
SUPPLEMENTAL CASH FLOW INFORMATION (Details) (USD $) | 12 Months Ended |
Dec. 31, 2012 | |
SUPPLEMENTAL CASH FLOW INFORMATION | |
Income taxes paid | $150,607 |