Pioneer’s Puffy Lake to produce this year

Another primary gold mine will be entering production in Manitoba this year. Pioneer Metals Corp has announced plans for an $18.1 million 500-ton-per-day mine at its Puffy Lake property located 45 mile northeast of Flin Flon. Pouring of gold could begin as early as December.

The go ahead follows receipt of a positive feasibility study completed by Kilborn Engineering, a Canadian consulting company. Kilborn concludes that the deposit, hosting reserves of 1.3 million tons grading 0.23 oz gold per ton, can be successfully mined using modified open stope methods. Using a lower cutoff grade of 0.07 oz gold per ton, Pioneer says reserves can be increased to 2 million tons grading 0.21 oz gold per ton. Important parameters included in the calculation are a 6.5-ft mining width and a 10% dilution factor.

Based on a milling rate of 500 tons per day, Puffy Lake will produce 40,000 oz of gold per year at cash operating cost of $175(US) per oz. — a cost which will place the mine in the lowest quartile for mines in North America.

Construction contracts are being negotiated and should be finalized shortly, Pioneer President Robert D. Willis says. Negotiations for the $18 million required to build the mill and place the mine into production, are also in progress. Mining will be via a decline ramp, completed earlier in the year to a depth of 300 ft (N.M. Dec. 8/86). Mr Willis notes that the decline can be used to extract ore from a depth of 800 ft — sufficient to sustain production for 5 years. After that, a vertical shaft would be required.