With almost 20 more mines now producing the yellow metal in Canada, as compared to last year, and prices going higher, the outlook for tomorrow’s gold mines could hardly be brighter. Gold mining in Canada is booming. Last year the yellow metal beat out three other metals — copper, iron ore and zinc — to become the single most valuable metal produced in Canada. In 1986 we poured 107.5 tonnes, (that’s 3.45 million oz) or $1.7 billion worth, according to Consolidated Goldfields of London. And while very few new base metals mines, and no new iron ore mines, are planned before 1995, our annual survey nevertheless includes a total of 109 exploration projects. These are projects which are so far advanced that they could very well become producing gold mines before 1995. Of this impressive total, we estimate about half have a better that 50-50 chance of becoming mines within the next three years. Moreover, these projects are located from coast to coast. How much gold these new mines would add to the nation’s total gold output is still very uncertain, considering that orebodies are still being blocked out, production rates have yet to be set and old mines will inevitably have their reserves depleted. But we estimate the amount could approach an additional 30 tonnes (or about a million ounces).
By now, everyone knows the reasons for the boom in gold exploration. A market price of about $450(US) per ounce, poor prices for just about every other mineral, fears of inflation, and flow-through tax incentives for the investor are among the most important factors.
Of the 69 mines in Canada that produce at least some gold already, the typical mine can produce an ounce at an operating cost to the owners of about $150-$200(US). Most of these mines, especially the 50 operations whose primary product is gold, are small underground operations. Those properties that are virtually certain to come into production over the next three years — four in British Columbia, seven in Ontario and six in Quebec — are, again underground mines.
While few of the new mines likely to come into production over the next 3-8 years will be open pit mines, a considerable amount of gold will nevertheless be recovered from surface deposits. These are deposits of mill tailings that have accumulated in the historic mining camps of the country — camps which succeeded in opening up this country’s hinterland at the turn of the century, giving birth to such communities as Yellowknife, Timmins, Kirkland Lake, Rouyn and Val d’Or. The highest concentration of these low-grade materials, formerly considered to be waste material, are in Timmins, Ont. Erg Resources, a company controlled by long-time gold producer Pamour Inc., is spending $65 million to build a new mill there that will treat a million tonnes of this material every month for about eight months a year. About 80,000 oz of gold will be produced from the Timmins tailings in 1989, the company predicts. In another Ontario gold camp, Lac Minerals is going to treat 750 tons of tailings per day from the old Lake Shore mine at Kirkland Lake to recover 20,000 oz of gold per year. And a third gold tailings project is taking shape near Yellowknife, N.W.T. that could produce 37,000 oz per year That’s 140,000 oz, or 4% of Canada’s total 1986 gold output that will likely be coming from material that’s already been dug out of the ground.
When gold miners go back to old “waste” material, there can be no doubt that gold mining is booming.
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