Minable reserves calculated for Daisy’s West gold zone

Drilling at the Daisy project in southern Nevada has confirmed a minable reserve of 542,000 tons averaging 0.025 oz. gold per ton in the West zone.

The project is owned 65% by Inter-Rock Gold (ME) and 35% by operator Rayrock Yellowknife Resources (TSE).

The combined oxide reserve for both the Secret Pass and West zones stands at 12 million tons grading 0.018 oz., equating to a reserve of 218,000 oz. Of this reserve, 175,500 oz. are estimated to be recoverable.

The partners plan to develop an open-pit mine, with a waste-to-ore ratio of about 2-to-1. More than 2 million tons of ore per year will be processed using heap-leach technology.

Pre-production capital costs are estimated to be just over US$6.1 million, including $400,000 for working capital and US$3.2 million for ongoing sustained capital costs.

Average annual production will be 30,000 oz. at an average cost of US$270 per oz.

Approvals are being sought for environmental and operating permits, with production anticipated for late 1996.

Inter-Rock and Rayrock think there is potential to increase reserves at the Daisy project by mining gold-bearing sulphide ore and carrying out additional exploration drilling.

The company is completing bio-oxidation test work on a large, 7-ton bulk sample taken from the Mother Lode pit.

Previous, smaller bulk samples taken from the Secret Pass deposit resulted in gold recoveries of 65% after bio-oxidation.

If this process proves viable, reserves contained in the Secret Pass would jump by 165,000 oz. In addition, the Mother Lode deposit contains a drill-indicated sulphide resource of 9.4 million tons containing 432,000 oz. Additional drilling would be necessary to prove up a minable reserve.

Elsewhere on the property, exploration drilling has encountered anomalous gold mineralization, 1 mile northeast of the Mother Lode pit. Follow-up drilling is planned for the Joshua zone.