Early decision on Ketza imperative for Canamax

The feasibility study on the Ketza River gold project just south of Ross River in the Yukon should be ready by the end of this month, John Hansuld, president of Canamax Resources, tells The Northern Miner.

It’s hoped that a production decision will be made as soon as possible after that time due to the northern location of the project, he says, adding that “because of the seasonal pressure, it is imperative to get up there by June.”

Production from the oxide reserves would start approximately 12 months after the green light is given. Capital costs for mine and mill are estimated at $18 million and this figure covers the handling of the oxides only, notes Mr Hansuld. Annual rate of production is estimated at 50,000 oz.

Canamax is operator of the project with a 50% interest while Pacific Trans Ocean Resources holds the remaining 50%. So far the partners have spent a total of $8 million on the property during the past three seasons.

Some 550,000 tons of oxide ore grading 0.53 oz gold per ton have been outlined to date. A number of other oxide zones are known to exist incl uding the Break zone discovered last summer and which is still open to extension at depth. (N.M, Feb 9/87) Sulphide reserves in the Peel zone total about 550,000 tons of 0.26 oz gold. Bell Creek mill on target

Ketza River will be mine No 2 for Canamax. No 1 is the Bell Creek mine near Timmins which graduated to commercial production last month. Some 18,000 oz is expected to be poured this year with 25,000 oz estimated for 1988.

Some 180 tons per day from Bell Creek is being shipped to Pamour Inc. for processing under a 9- month contract. By mid-March the amount will be upped to 300 tpd. “We’ll carry on at 300 tpd until we’re up and running with our own 350-tpd mill which should be ready by mid-summer,” says Mr Hansuld.

Progress is on target on the new mill with the pouring of the foundation under way and all the major equipment already on site.

Reserves at the mine stand at 1.578 million tons grading 0.2 oz per ton. Of that amount, the North zone accounts for 840,000 tons of 0.2 oz, while the Bell Creek deposit has 272,000 tons grading 0.12 oz. The Marlhill deposit has three zones with 439,000 tons grading 0.23 oz.

The company is spending $1.8 million for an underground ramp at the Marlhill this year. The ramp is now down to the 500-ft level with drifting on the 165-ft level. Looking down the road

Canamax has three other projects under its belt which the company foresees as transforming into mines three, four and five.

At its 50% owned Kremzar project, near Wawa, Ont., a feasibility study is under way and should be ready in the next few months. Reserves stand at 1.1 million tons of 0.235. Should a go-ahead be given, production could start by mid-1988 after development costs of $16 million. Some 26,000 oz of gold is estimated as annual production at a planned rate of 400 tpd.

At the Matheson project located in Harker-Holloway twps., Ont., some $2.6 million is being directed to underground exploration on the East zone, while $800,000 will go towards a drill program on the Mattawasaga zone, which is the eastern extension of American Barricks’s Holt-McDermott mine.

Reserves at Matheson stand at 578,000 tons averaging 0.22 oz gold per ton.

Two drills are working on the Clavos property , northeast of Timmins, where reserves currently stand at 470,000 tons averaging 0.212 oz. While one rig is doing step-out drilling over the 3-mile length along the Pipestone Fault, a second drill is testing the Discovery deposit in preparation for a feasibility study this year. Reserves here stand at 470,000 tons averaging 0.212 oz gold.

Canamax, which trades on the TSE at about the $7 level, will continue to use flow-through funds for its exploration projects, says Mr Hansuld. But development costs will be covered by a combination of equity and debt. “We’re looking at all the options,” says the president.