***The article has been updated with the latest share price data for Rubicon Minerals ***
Toronto-based Rubicon Minerals (TSE:RMX) (NYSE-MKT:RBY) shares shot up over 10 percent Tuesday as it says that it has consented, together with the Province of Ontario, to the request of Wabauskang First Nation (WFN) to postpone their application for judicial review of a production closure plan related to the company's Phoenix gold project in the region.
This gives the company time to further negotiate with the First Nation group toward advancing its project.
Under the terms of the consent order, WFN will not be able to perfect their application until 90 days after the Ontario Court of Appeal gives its decision in Keewatin versus Minister of Natural Resources.
"Rubicon has demonstrated good faith and has respectfully engaged with its Aboriginal neighbours. WFN's request for a postponement was welcomed by Rubicon," the company said in its statement, adding that it prefers continued negotiations with WFN, and is hoping for "meaningful progress" toward a benefits agreement during this time.
Shares of Rubicon rose over 10 percent by late afternoon, to trade at $2.35 in Toronto.
The advanced stage gold development company, which is focused on its Phoneix gold project in Red Lake, Ontario, was named in a petition for judicial review, focused on the Province of Ontario's authority to approve a production closure plan. In late December, Rubicon said it considered the legal action brought upon the company by the WFN group to be without merit.
It also said at the time that construction activities, including shaft sinking and mill construction continue to progress at the Phoenix project.
The company reiterated Tuesday that it is "proud of its consultation record with the neighbouring Aboriginal Communities and of its conduct in the Red Lake district, including the company's commitment to safe and responsible resource development and the successful provision of contracting and employment opportunities."
The gold development company has been engaged in discussions with the First Nation group since January 2009.
It said today it remains committed to the ongoing consultation and negotiation process, but if necessary, the company is prepared to "vigorously defend its consultation record" and its ability to continue development of the Phoenix gold project, in any legal dispute.
The F2 gold deposit at Phoenix boasts an indicated resource of 1.02 million tonnes, grading 14.5 grams per tonne gold for a total of 477,000 ounces of gold, and an inferred resource of 4.23 million tonnes, grading 17.0 grams for a total of 2.31 million ounces of the precious metal.
The project produced a preliminary economic assessment that allowed the company to go to market last year with a bought deal equity financing of just over C$200 million.
The company is in the midst of carrying out studies designed to optimize certain aspects of its preliminary economic assessment, with these studies slated to be wrapped up in the second quarter of this year. An updated resource estimate is also expected this quarter.
Most importantly, based on this schedule, the company says it is planning to advance toward potential production in the second half of next year.
The Phoenix project, which is fully permitted and funded, is expected to produce 180,000 ounces of gold per year for the 12 years of mine life, with grades of roughly 14 grams per tonne (g/t) and a forecasted 92.5 per cent recovery.
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