Campbell seeks more gold at Joe Mann

Having sold various non-core assets, Campbell Resources (TSE) is now focusing on improving production and profitability at the Joe Mann copper-gold mine, 38 miles south of Chibougamau, Que.

The strategy involves increasing productivity and reducing costs. The company is also hoping to augment gold reserves by 1 million tons at a grade of 0.22 oz. per ton. To this end, extensive mine lateral development and underground drilling (29,900 and 104,000 ft., respectively) were carried out last year.

The development work, which was performed on the four deepest production levels (below the 1,650 level), has paved the way for further exploration drilling.

The original deposit was discovered in 1950, and about 686,000 tons averaging 0.22 oz. were milled before the surface plant was destroyed by fire in 1961. In 1973, the plant was rebuilt and an additional 173,000 tons grading 0.154 oz. were mined before rising costs and poor recoveries forced closure in 1975. Five years later, Meston Resources acquired the property and dewatered the shaft. However, financial and corporate problems resulted in yet another closure.

Campbell acquired a stake in Joe Mann in 1983 when it bought an interest in Meston. The mine was once again dewatered and, in 1985, an underground exploration program was started. Commercial production resumed in 1987 following the delineation of proven and probable reserves of 910,000 tons averaging 0.22 oz. Campbell then assumed complete ownership of Joe Mann by acquiring all the outstanding shares of Meston.

Gold is mined principally from two parallel systems known as the Main and the South veins. Together, these account for 70% of the known reserves. Both veins strike east-west and dip about 80 to the north. Mining extends over a 3,000-ft. strike length and to a depth of 2,300 ft. in both veins. Both veins remain open at depth.

Campbell is now embarking on the second stage of development at Joe Mann. This year, it plans to spend $6.8 million on an additional 32,000 ft. of lateral development and 172,000 ft. of exploration drilling. The drilling is aimed both at delineating reserves on the down-rake extension of known orebodies and at testing for new zones along strike and west of the Main and South zones.

Drilling of the down-rake extension has intersected mineralization averaging 0.906 oz. over 7.6 ft., as well as 0.349 oz. over 18.7 ft. An intercept drilled to the west averaged 0.258 oz. over 21 ft.

About $2 million will be spent proving up additional reserves below the existing workings, while drilling to the west of the current workings is expected to cost $500,000.

The rocks in the mine area consist of mafic lavas intruded by gabbroic sills and feldspar porphyry dykes, which were introduced along an old east-west-trending structure.

In 1992, Joe Mann produced 72,000 oz. gold at a cash operating cost of US$294 per oz. This year, it is expected to yield 65,000 oz. at US$276 per oz. Campbell estimates that the same production level and operating cost can be attained for 1995 and 1996.

As of December, 1993, proven and probable reserves stood at 1.1 million tons averaging 0.3% copper and 0.268 oz. gold. The mine also contains 1.8 million tons of possible ore averaging 0.28% copper and 0.258 oz. gold.