Vancouver – A redevelopment plan launched by Queenstake Resources (QRL-T, QEE-X) last summer appears to be improving gold production at the Jerritt Canyon mine complex in northeastern Nevada, though cash costs remain higher than initially projected.
The company produced 45,555 oz. gold from several underground deposits during the fourth quarter of 2005, roughly in line with the re-development plan.
While final operating costs and financial results won’t be reported until mid-March, cash operating costs for the quarter are expected to be higher than the previous estimate of US$370-US$380 per oz., and “slightly above” cash costs of US$401 per oz. achieved in the third quarter of 2005. At least US$25 of the projected total reflects increased prices for electricity, energy, and cement.
Jerritt Canyon is an energy-intensive operation as mineralization is highly refractory, with high clay and moisture content, and requires roasting before final gold extraction. The redevelopment plan involved scaling back two roasters to one, and various other measures aimed at matching mill processing with a sustainable mining rate to optimize operations.
The average head-grade in the quarter was 8 grams gold per tonne, which represents a 14% improvement over the third quarter and the first nine months of 2005. The average mill recovery was 86.8% for the quarter, slightly above the average of 86.6% achieved in the full year.
The re-development plan also involves increasing mine development. The company notes that capitalized development was slightly ahead of plan for both the quarter and full year.
Jerritt Canyon has produced more than 7 million oz. gold since 1981, when a previous operator placed the mine into production. Operations ceased in 1999, and the mine was purchased by Queenstake in mid-2003.
The mine complex produced 204,091 oz. gold for the full year 2005, at cash costs estimated to be about US$390 per oz. Production this year is expected to total between 200,000 and 220,000 oz. gold.
Be the first to comment on "Queenstake sees improvements at Jerritt Canyon"