Metall Mining gives Troilus the go-ahead

After deciding earlier this year to shelve the Izok Lake base metal project in the Northwest Territories, Metall Mining (TSE) has given the go-ahead for development of a gold project in northwestern Quebec.

Metall’s board of directors recently approved the feasibility study for the Troilus project, 110 miles north of Chibougamau.

According to John Purkis, vice-president of projects for Metall, “this is a big project for us.” He added that “one of our corporate goals is to put a mine into production every year for the next few years.

“We’re also commissioning the Bougrine lead-zinc mine in Tunisia and later this year the Cayeli copper-zinc mine in Turkey will be commissioned. The Troilus will be our next mine after these projects go into production.” Minable reserves at Troilus are estimated at 44.7 million tons averaging 0.11% copper, 0.04 oz. gold and 0.04 oz. silver per ton. In addition to the deposit being open at depth, Metall also has what it believes are promising properties north and south of the project.

“Although with these grades it’s tough to imagine an underground mine, we feel there is great potential in the immediate area,” Purkis said. “We plan to spend at least $500,000 on exploration over the next year — initially to add tonnage, but also to find other orebodies.”

The mine is expected to produce almost 4.3 million grams (138,000 oz.) gold per year at a cash operating cost of US$222 per oz. over 14 years. During the first four years, production will average 4.9 million grams (158,000 oz.) gold per year at an operating cost of US$173 per oz. The higher production and lower operating costs over this period will be achieved by mining higher-grade material with a low stripping ratio.

Capital costs for the project are expected to be about $150 million, the bulk of which, according to Purkis, will be financed through a bank gold loan. The ore will be mined by conventional open-pit methods with a stripping ratio of 2.85-to-1. An 11,000-ton-per-day mill will be constructed, utilizing a combination of techniques (gravity, copper-pyrite flotation and cyanidation of flotation tailings).

Recoveries are expected to be about 87% for gold and 79% for copper. Forty per cent of the gold will be in copper concentrate form, with the remaining 60% to be shipped as dore bars.

Power for the project will be supplied via an 85-mile, 161-kV powerline to be constructed from the Hydro Quebec substation southwest of Chibougamau. The development of the gold deposit will proceed subject to the receipt of all the necessary permits and completion of financing.

At presstime, the environmental review was well-advanced, with an impact statement having been submitted last October and a positive recommendation expected in early summer.

Road upgrading and temporary power installation will begin later this summer. If all goes well, the mine should start up in the third quarter of 1996.