Mining firms attracted to southwestern U.S.

Canadian companies have actively explored for minerals in the U.S. over the years, but the level of activity today has reached an all-time high. Much of it is taking place in the western part of the U.S. — Nevada, h California and Arizona. In general, the work has been financed out of a Vancouver, a leading venture capital market which has been responsible for u several major gold discoveries during the 1980s. Despite the premium on the American dollar, companies are particularly attracted to gold heap leach projects in the southwestern U.S. where startup costs are within the financial capability of a so-called junior company. (Not that long ago this wasn’t the case, and usually the participation of a major mining company was required to secure adequate financing).

While there certainly have been some failures (both in leaching and conventional hard rock operations), the companies that were successful have gone on to develop new mines, Pegasus Gold being one example. Besides its two mines at Zortman-Landusky in Montana, Pegasus is now producing from Florida and Relief Canyons in Nevada (heap leach) and from Montana Tunnels (conventional) near Helena, Mont. There are other examples as well, including Glamis Gold, Grandview Resources, Pioneer Metals, Northern Dynasty and several others which are on the fast track to production. Most of these companies are exploring on or around their existing properties.

Amca Resources has been test- leaching material at its Silver Cross property near Phoenix, Ariz., and expects to develop the prospect further, partly from cash flow. Gold and silver values on the property are associated with folded andesites and rhyolites.

The company’s joint venture partner is Flow Resources of Vancouver headed by Ron Bieber. On a recent visit several weeks ago he said that leaching was under way on the first pad and gold was being recovered from 12,000 to 15,000 tons of ore. The second pad, with a 20,000-ton capacity, was being loaded and a third had just been completed.

The latter has a cement base and will be used to treat at least 3,000 tons l of high grade copper-bearing ore. This material is expected to grade about 5-7% copper, 0.7 to 1.0 oz gold, and 7-10 oz silver per ton. Pilot testing – thus far has successfully treated this material, he noted. Other copper-bearing outcrops exist approximately 800 ft from the current workings. Previous trenching suggests the mineralized zone hosting the present workings extends for another 3,000 ft and longer. Further exploration is planned during the current production phase.

Amir Mines and Arizona Star Resource Corp. are joint venturing a gold property near Kingman, Ariz. The work is actually being funded by Amir through share subscriptions in Arizona Star, which is putting the money into the property. Ultimately, Amir will control Arizona Star. Drill indicated and inferred reserves are estimated to be two million tons on the (Van Deemen) property will include 10,000 ft of reverse circulation drilling to expand reserves in known zones. Also to be tested is the extensive detachment breccia on much of the property. At last report, the work program was under way.

Sun River Gold has been concentrating its efforts on developing the United Western mine property near Oatman, Ariz. This is an underground gold prospect with what the company describes as “reasonably assured” reserves of 118,054 tons grading 0.259 oz gold and inferred reserves of 107,608 tons grading 0.268 oz gold. Gold- bearing values have been returned to the northwest and southeast of existing mine workings and good potential exists for developing additional reserves. The company has been negotiating for additional ground in the area to expand its reserve base.

Rockingham Resources says that production has commenced at its gold placer g property in Yavapai Cty., Ariz. Modifications have been made to its plant to maximize gold recovery. Test work on the 635-acre property suggests there are at least 165,500 cu yd of alluvial placer gravels averaging $8.25(US) per yd at a $450 gold price. Mining is done with a backhoe which feeds a 150-yd-per-hour mobile screening plant and sluice box. By late May, the mine – contractor was supplying 1,200 yd per day, per eight-hour shift and a second shift was being added.

Further trenching and reverse circulation drilling is planned this June on Odessa Explorations’ Birchville mine property 50 miles north of Sacramento, Calif. An underground exploration program including four diamond drill holes was recently completed which will be followed up. A previously completed VLF-EM survey was recently reinterpreted and 11 major targets have been outlined.

In the past, ore-bearing zones were thought to be thin-veined underground structures but now there is evidence of wide shear zones containing disseminated gold which might be mineable by open pit. A previously trenched shear zone with two intersecting quartz veins assayed 0.063 oz gold over a 50 ft length.

Developing a placer gold property in northeastern California is Centurion Minerals of Vancouver. The company claims to have more than 17 million yd of reserves on its San Juan gold project of which 8.4 million would be used to justify production. Centurion is aiming for an initial production rate of one million cu yd per annum or 33,000 oz gold. Fill-in drilling and detailed i engineering is required prior to final feasibility. The company has an option to acquire a 50% interest in the project from St. Joe Minerals and has plans i to purchase another 40% from another party.m

Bentley Resources has been drilling its Bagdad Chase property east of n Barstow, Calif. Earlier work blocked out 280,000 tons grading 0.14 oz gold in the Bagdad West claims about 3,000 ft from the main zone. Bentley has the a right to earn a 100% working interest in the Bagdad West by paying Echo Bay Mines $300,000 and a sliding scale smelter royalty. The rest of the property, is owned by Bentley. The latest drill program is designed to confirm and extend reserves in the Bagdad West claims, the company notes.

Panosoni Energy and Weaco Resources have concluded a joint- venture agreement to explore the former’s gold property in Inyo Cty., Calif. Additional ground is being acquired on the north boundary of the property which will be incorporated into the joint venture. This will give them an additional 2.5 miles of strike length to the fault-oriented system known as the Yellow Zone and a possible extension of the quartz system which produces gh grade gold values throughout the approximate 1-mile length of the Panasoni mineral property.

Joint venturing the Friday- Deadwood gold project near Elk City, Idaho, are Normine Resources, Amir Mines, and Glamis Gold. Under the joint venture agreement, Glamis can earn a 51% interest in the property by funding exploration to a maximum $1 million(US) in private placements in the two junior companies. Glamis will also have to finance all development and production costs.

A sheared gold zone 140-180 ft wide and 1,400 ft long has been outlined so far by reverse circulation drilling. Proven and probable reserves are a estimated to be at least three million tons grading 0.04 oz gold per ton. Metallurgical test work has indicated a 75% recovery rate for gold. Extensive leach testing is planned by Glamis this summer. More drilling is planned this year on the North Deadwood zone where the potential is thought to be 20 million tons ranging from 0.03 to 0.04 oz gold per ton.

Mintek Resources recently acquired a controlling interest in two gold prospects in California. Sampling of surface exposures and underground workings at the property in San Bernardino Cty. has so far shown significant gold mineralization over mineable widths, the company states. A second property, about 13 miles northeast of the Bodie district, has strong potential for both surface disseminated and buried lode targets. Both properties are ready to drill and this will be done with funds secured from a public financing.

Magellan Resources owns more than 2,000 acres in the Southern Cross dist
rict of Montana. Anaconda Minerals has estimated the old Southern Cross mine contains more than 250,000 oz gold in material grading about 0.6 oz gold. Two ore zones have been identified by Magellan in a previously unexplored area of the property; results from the recent drill program will be incorporated into a feasibility study which could lead to a production decision in the fourth quarter, says the company.

Radcliffe Resources drilled its Valley View property in California earlier this year with encouraging results. Diamond drill hole No 1 included 25 ft of 0.24 oz gold and 20 ft of 0.22 oz. The drilling tested massive sulphide * horizons at depths of approximately 100 ft and 200 ft down dip. There are at least five other massive sulphide outcroppings which will be evaluated before more drilling is done. The company also plans to drill its Independence property in northeastern Nevada this spring.

Noramex Minerals and its partner Calvada Resources are joint venturing the Bunce gold project near Lovelock, Nev. Planned work includes an extensive trenching program on the Discovery zone and other unexplored hot spring deposits. Reserves are presently 85,000 tons grading 0.074 oz gold in the Discovery which is still open. The material is readily heap leachable, tests have shown.

Cornucopia Resources recently announced that shallow drilling had located near surface oxide reserves at its Ivanhoe property in Nevada’s Carlin gold belt. The new area is slightly less than a mile from the main deposit which could have up to 10 million tons of reserves grading 0.045 oz gold. Drilling is planned eventually on deeper targets. Quartz Mountain Gold has budgeted $2.5 million(US) to drill the Crone Hill and Quartz Butte deposits in southern Oregon over the next six months. A higher grade portion of the property contains some 47.6 million tons averaging 0.03 oz gold. The company is currently completing a project management/engineering agreement to develop the property. Consolidated McKinney Resources can acquire up to a 50% interest in a gold property in northwestern Wyoming. Extensive work done by the U.S. Geological exploration and drilling program is planned during the next few months.