Cannon mine in Washington turns out 145,000 oz gold in 1988

There was no evidence of a “For Sale” sign up when The Northern Miner visited the project recently. Late last year Gulf Canada Resources (TSE) announced plans to sell its 92% interest in Asamera (which owns 51% of the Cannon mine) so the company can concentrate on its petroleum business.

Vancouver-based Breakwater Resources (TSE) has a 49% interest in the operation and, it says, the right of first refusal on any offer tendered — that is to say it can match any bid.

In recent years, oil and mining have proven to be a difficult mix so the move by Gulf didn’t surprise anyone including Asamera or Breakwater. A group headed by Bruce Kennedy, ex-senior vice- president exploration for Asamera is said to be interested in taking over the company which has a few other significant properties besides Cannon.

Corona Corp. (TSE), a significant shareholder in Breakwater, is also viewed as a serious contender, Bond International Gold (TSE) has been mentioned, and several others including Northgate Exploration (TSE) and Metall Mining (TSE).

Asamera and Cannon would be an attractive buy for any company — at the right price of course. (The asking price is rumored to be near what Gulf paid for it last year when gold was higher and the Canadian dollar weaker). It’s a well-managed mining operation with skilled technical, support, and operations staff, all of whom are more than pleased to live in the bustling community of Wenatchee.

Last year the mine produced approximately 145,695 oz gold from head grades averaging 0.3 oz gold; and the grade aspect of the operation was higher than forecast, according to Ben Guenther, mine superintendent. Precious metals output includes a small amount of silver which runs about 0.56 oz per ton, he added.

A non-unionized operation, the mine works two 11-hour shifts (seven days per week) and employees get seven days off every four weeks. “They voted for this and we haven’t had a lost time acci 0000,0600 dent since they went on this schedule in June,” he said.

The mine was scheduled to shut down for Christmas and a 4,500 ton live storage stockpile is available for times like this, he noted. Mill throughput is currently 1,500 tons per day so that stockpile would be good for three days.

Hoisting is done one shift per day seven days a week which is adequate for existing production requirements. There is plenty of hoisting capacity left in the event underground production is expanded. Turnover is understandably low because of the mine’s location and “we have good skilled people,” he emphasized.

Where possible, ramps, shops, sumps and haulage ways are driven in rhyodacite because it’s considerably more competent than the ground in stoping areas. As noted earlier, the mine is located on the outskirts of Wenatchee and houses exist a few hundred yards from the portal not to mention a riding stable which is underlain by the Cannon mine’s B North zone. This area could have been mined by open pit but the stable owners didn’t want to give up their surface rights.

Mining method is underhand cut-and-fill and the orebody is divided into 24 ft wide slots including the B North which is 400 ft wide in spots. Access drifts are generally driven in the footwall and stope or sub-drifts in the hangingwall. The slot begins as a drop raise which is widened out and expanded to full stope width and length by bench drilling. Broken ore is extracted and the empty stope is filled with cemented backfill which is deposited there by loaders. The mine is very well ventilated and fans provide about 450,000 cfm per minute.

The backfill system operates very well and is quite innovative. Bore holes have been put in for sand and aggregate and a raise for cement. Everything is mixed underground and it takes about four minutes to produce an 18-ton batch of backfill. To get fill tight to the stope back, loaders have a ramming device (almost like a hoe) which is pushed out mechanically and “there are usually no gaps between the back and the backfill, ” Guenther said. This was more than evident on a mine tour where a previously-filled stope had been broken into. The filled section looked much like a bed of conglomerate.

Development waste is used for secondary stopes and it’s delivered by truck to these areas rather than to surface.

Underground dilution is minimal and is estimated at 5%, most of which is old fill.

The underground has its own crushing system and ore is reduced to six inches before it’s hoisted to surface. The concrete-lined circular shaft has wooden guides and counter-balanced, bottom dump, 6-ton skips for hoisting ore to surface. It’s all run by a process control and there is no skip tender at the bottom for the 500 horsepower double drum hoist.

Conventional percussion drills are used for long hole drilling and down-the-hole hammers for slots and drain holes “where we need accuracy,” he said. Remote-controlled load-haul-dump (LHD) vehicles, many of them five yard, are used for mucking out high stopes.

Mine reserves are carried along 2,000 ft of strike length so there is considerable reserve potential left, said William Bond, chief geologist. 0600,0000 A year ago, reserves stood at 4.5 million tons grading 0.26 oz gold but these will soon be updated to reflect mined out areas and new reserve additions.

“In the past two years, we have pretty well replaced the amount of tons mined and added significant reserves in the lower B-Neath area which was a bit wider and deeper than anticipated,” he noted. This zone was thought to have been faulted off but drilling showed otherwise, he said, pointing out that tonnage has also been added to the B-4 zone.

Two drills are being utilized underground on a full-time basis to delineate extensions of ore zones. And Asamera plans to put down a series of 2,000 ft holes adjacent to the mine both from the underground and also from surface. One hole is presently being drilled to the west through the B-Neath zone which should give them some idea of the different lithologies. “If there are any zones near current mine workings, we want to define these before mining comes to an end,” he emphasized.

A fairly extensive evaluation has been made of the nearby Lovitt mine property which was thought to have some open pit potential; but Guenther conceded they “haven’t found a lot there that looks promising or in the C reef.” A major diamond and reverse circulation drilling program was completed there in 1987 and early 1988 which identified some low grade mineralization ranging from 0.04-.06 oz. A few higher grade sections, possibly old pillars which graded below the old mine cutoff, were also encountered. The Wenatchee heights area is also being drilled and the company describes this as an “exploration play.”

Mill superintendent, Donald Moore, was optimistic throughput would average about 1,420 tons per day for 1988 and possibly better this year. Because the underground operation is relatively small, he conceded the mine has at times had problems supplying ore to the mill which incidentally is rated at 2 ,000 tons.

Gold recoveries have recently been averaging 92% because of some well thought out changes to the flow sheet including the installation of a 2-stage cyclone system and flash flotation cells. All the company’s gold production goes out in concentrate form and over the years they have looked at ways of refining gold right on the property.”But we haven’t found that it’s economical because we don’t have the reserves to recover the large capital outlay,” he said.

About 27,000 tons of concentrate is produced each year grading 5.5 to 6.0 oz per ton. The concentrate isn’t sent to any single smelter; half of it goes to Japan and the remainder to Asarco’s East Helena smelter in Montana “for competitive reasons and to ensure a source of processing,
” he explained.

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