Battle Mountain keen on Vera and Holloway properties

The size of the Vera-Nancy gold deposit in Australia could be significantly increased, according to Battle Mountain Gold (BMG-N).

In a presentation before gold analysts in New York City, Karl Elers, Battle Mountain’s chairman, said he was encouraged by the results of several stepout drill holes at the Nancy North. Six holes returned grades ranging from 6 grams gold per tonne over 11 metres to more than 18 grams over 22 metres.

The company and partner Normandy mining have scheduled additional drilling to confirm the continuity and size of this new mineralization. New drill data is anticipated to nudge reserves past a previous resource calculation of 1 million oz.

Deep drilling at Ontario’s recently opened Holloway gold mine is also returning good grades. In the Lightning zone, the company intersected gold mineralization grading 11.6 grams over 2.9 metres. Elers believes the productive stratigraphy at depth indicates “great up-side potential for Holloway.”

Battle Mountain holds an 84.7%-interest in that operation. Teddy Bear Valley Mines (TBV-T) holds the remaining 15.3% interest, and has a 40% interest in potential deep mineralization.

Battle Mountain will close three of its high-cost gold mines over the course of 1997, including the San Luis in Colorado, the Silidor in Quebec and the Red Dome in Australia. However, the company will begin production at the Vera-Nancy deposit and the Lihir gold mine, which is operated by Lihir Gold, in Papua New Guinea. Both of those operations are expected to be low-cost producers.

As a result of the closures, Battle Mountain anticipates its 1997 gold production to drop to 900,000 oz. from 930,00 oz. in 1996.

Lower-than-expected production from the Kori Kollo mine in Bolivia also contributes to the slip in production. Overall, the company hopes to lower its production costs by up to 10% in 1997.