The Big Springs gold project in northeastern Nevada has been deemed commercially viable by Freeport McMoRan Gold and production could begin this September. Bull Run Gold Mines has a 40% interest in the project which will cost $21.8 million(US) to develop in two phases.
Gold production from 400,000 tons of ore should be around 60,000 oz per year, all of which will be extracted by heap leach and cyanide agitation methods. Reserves are sufficient for 10 years of operation and Elders IXL, a large Australian conglomerate, will meet 100% of Bull Run’s financial obligations.
Elders is also becoming an aggressive player in the Canadian gold mining sector, having recently agreed to fund Trader Resources’ Tel gold deposit to production. That particular property is located west of Prince Rupert, B.C., and Elders will be able to earn a 50% interest in the venture.
Elders has made a $12.5-million credit facility available to Bull Run to cover its share of costs. The company will be able to convert a part of the loan into Bull Run common shares; warrants will be attached for additional shares.
Freeport has submitted an environmental assessment report to the United States forest service for approval and the issue of permits is expected by mid-May. Conventional open pit mining techniques will be utilized and mining should get under way in July.
A heap leach recovery plant will be installed first with completion scheduled for this September. Gold production will commence at that time and a roaster and cyanide agitation mill will be added in June, 1988. Full production is scheduled for the third quarter of 1988. Capital costs for the two phases are $10.6 million and $11.2 million, respectively.
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