MEXICO AND CENTRAL AMERICA — Mexico’s Trinidad mine poised for production

With the first gold pour imminent, the newly constructed Trinidad gold mine in Mexico’s Sinaloa state is expected to reach commercial levels of production in the next few months.

The open-pit, heap-leach operation is 51%-owned by Eldorado Gold (ELD-T), which is also the operator. The remaining interest is held by Almaden Resources (AMH-V).

Construction began in February and was recently completed at a capital cost of just under US$6.2 million.

The mine is expected to yield upwards of 6,000 oz. gold by year-end, whereas next year’s production target is 30,000 oz. at an estimated cash cost of US$205 per oz. This will recede to 22,000 oz. per year for the remainder of the mine’s 4-year life. Cash costs over this period are are expected to average US$231 per oz.

Almaden initially acquired La Trinidad under a lease option and can buy it outright for US$500,000. In 1993, it optioned a 51% interest in the property to Eldorado, which was required to make all the underlying payments and complete a feasibility study.

In 1994, Eldorado carried out 39,000 ft. of reverse-circulation drilling in 207 holes on the Taunus and Colinas gold zones. The former is a shallow-dipping oxide structure partially exposed at surface and measuring 2,165 ft. long and up to 450 ft. wide. Gold-silver mineralization is associated with a low-angle, silicified, breccia zone. Minable reserves here stand at 2.3 million tons grading 0.058 oz. gold per ton, or about 132,000 contained ounces, at a stripping ratio of 1.68-to-1.

The Colinas zone lies 1,300 ft. to the south of the Taunus deposit and contains a partially outlined resource of 360,000 tons grading 0.036 oz. The zone remains open to the northeast and southeast, with gold-silver mineralization occuring in hematite veins and veinlets.

La Trinidad hosts a measured, indicated and inferred reserve of 3.7 million tons grading 0.048 oz. Reserves are likely to increase with further development and exploration drilling in the immediate area of the pit.

A 15,000-ft. program of reverse-circulation drilling is attempting to expand the southern boundary of the Taunus deposit and develop the Colinas zone further.

A program of geological mapping, geochemical sampling and trenching is being carried out on prospective targets, and next year’s exploration budget is set at US$2 million.

Management of Eldorado believes La Trinidad represents a new gold camp, which parallels the Rosario gold district, where historic production exceeded 2 million oz.

Open-pit mining is carried out by a contractor. The ore is crushed to minus half an inch and placed on a heap-leach pad using a radial stacker. On an annual basis, the the mine is expected to process 575,000 tons.

To date, more than 55,000 tons of crushed ore averaging 0.09 oz. gold have been placed on the leach pad. Eldorado and Almaden report the grades of the benches mined to date are much higher than the predicted mine model grades of 0.058 oz. Narrow, high-grade structures cutting through the Taunus deposit are responsible for the increase in grade.

Gold is recovered by a carbon column plant, with recoveries expected to average 70%.