Production exceeds expectations at Eagle River

With Hemlo just down the road, any mine would look small by comparison. But the Eagle River gold mine of River Gold Mines (RIV-T) ranks high in every other respect.

The Northern Miner joined a large gathering of employees, shareholders and mining analysts to celebrate the official opening of the mine, 50 km west of this northern Ontario community. Also present were local officials and Bud Wildman, member of provincial parliament for Algoma.

Eagle River is targeted to produce 50,000 oz. gold this year. Proven, probable and possible reserves currently stand at 1.05 million tonnes grading 12.67 grams gold per tonne. The proven and probable material is sufficient to sustain the mine for five years, based on current gold prices. Efforts are under way to increase reserves through ongoing underground exploration.

This fall, River Gold will sink a shaft to a depth of 2,500 ft. — almost 2,000 ft. below any of the known reserves — in an attempt to locate gold-bearing quartz veins at deeper levels.

“We want to sink the shaft so we can prove our reserves from the bottom up and the top down, through a ramp system,” explained Aleks Kusic, chief geologist. “That’s because, in a shear-hosted quartz vein deposit, it is difficult to prove up any reserves [for] more than 36 months.” After the shaft is sunk, a 1.5-km drift will be driven to the No. 2 zone.

Kusic sees potential for reserves to double in two years.

Situated in the Wawa Archean greenstone belt, the property features quartz veins hosted by a shear structure that is part of the Eagle River deformation zone. This regional zone cuts an east-west-striking, steeply north-dipping sequence of mafic-to-intermediate volcanics with subordinate, intermediate-to-felsic, epiclastic members and narrow oxide-facies banded iron formation. The three main zones of mineralization are numbered 2, 6 and 8; Nos. 6 and 8 are under development.

The gold is predominantly free, and 60% of it is found along quartz-sericite-chlorite contacts. “This is a tough deposit in that, although there are places where the quartz vein system is 20 or 25 ft. wide, 90% of the contained gold is in a 4- or 5-ft. width,” said Kusic.

The property was prospected in 1982 and subsequently sold to River Gold (then known as Central Crude). In 1986, Hemlo Gold (HEM-T) acquired a 60% interest, and its parent, Noranda (NOR-T), spent the next eight years sampling and drilling the property, eventually starting underground development.

In 1994, Western Quebec Mines (WQM-T) bought both Hemlo’s 60% interest, and its 4 million shares (48%) of Central Crude, which then changed its name to River Gold Mines. Although the project is now wholly owned by River Gold, Western Quebec owns 41% of River Gold’s shares and is managing the mine.

In November 1994, Ross & Finlay of Val d’Or, Que., was awarded a 1-year mining contract. The original mine workings (2,729 metres) were dewatered, and development work began on the 100-, 120- and 140-metre horizons.

By October 1995, the mine was producing development ore, with a stockpile of 27,462 tonnes on surface and an underground inventory of 18,000 tonnes. River Gold personnel took over development and mining in November 1995, since which time an additional 70,000 tonnes of material have been broken. Commercial production began in January of this year, and, in the first quarter, the mine produced 18,236 oz. gold and 1.484 oz. silver from 37,325 tonnes of ore. The recovered grade was 15.2 grams gold, placing Eagle River among the 10 highest-grade gold mines in the country.

The mine’s performance helped River Gold to a first-quarter net income of $3 million and cash flow of $5 million. Cash production costs amounted to US$195 per oz.

Trackless operation

The Eagle River mine is a trackless operation, and, since the gold-bearing structure is often less than 1.5 metres wide, mining is carried out by means of shrinkage stoping. Lower-cost mining methods may be employed in the future.

Three crews of 21 men, plus five supervisors, work underground. The mine operates seven days a week, yielding 350 tonnes per day.

Twenty-five-tonne dump trucks haul ore 18 km to the Magnacon mill, which, though currently owned by the Magnacon joint venture, is expected to be sold to River Gold this summer.

The mill, a cyanidation plant employing the Merrill-Crowe process, was achieving recoveries in excess of 97% within two months of startup.

The ore is either dumped into the 100-tonne coarse ore bin or stockpiled in the yard, to be picked up by front-end loader at a later date. A jaw crusher reduces the material to 3-inch pieces and drops them onto a conveyor, which in turn drops them onto a vibrating screen. Ore that passes through the screen enters a 1,700-tonne fine ore bin, while larger pieces are sent to a cone crusher. The fine ore is conveyed to a ball mill, which reduces it to a fine pulp. Water, cyanide and lime are added, and gold particles exposed by the grinding process are dissolved by the cyanide.

Gravity concentration

The slurry from the ball mill is pumped to a cyclone classifier to separate coarse particles from the slurry stream. Some of these particles are sent back to the ball mill, while some are sent directly to a Knelson concentrator (added to the mill by River Gold), which yields a 75% gold concentrate. This gravity concentration of gold accounts for 45-75% of the total gold recovered at the mill.

The rest of the gold is recovered via the Merrill-Crowe circuit. A thickener raises the density of the slurry, after which it is sent to agitator tanks for complete cyanidation. The remaining solution, pregnant with gold, is passed through clarifier filters, rendering it crystal-clear. Air is removed from the solution, and the gold is then precipitated onto fine particles of zinc. The gold and zinc are separated in a furnace, and dore bars containing 85-90% gold are poured and shipped to a refinery.

The tailings from the mill are pumped to a tailings pond, where the water is checked for cyanide and other substances, and, if necessary, treated.

In July, the mill is scheduled to be refurbished in an attempt to improve recoveries and increase production capabilities.

In addition, the company is planning a $600,000 summer-fall program of surface exploration combined with underground exploration and development of the high-grade Edwards project, to the northeast. River Gold has signed an agreement with Edwards’ owner, VenCan Gold (VCG-M), to mine the deposit.