Prospects brighten for Black Hawk

The switch to processing material from the Farley Lake pit has boosted head grades at the Keystone gold mine, near Lynn Lake, Man., and owner Black Hawk Mining (BHK-T) expects head grades to improve further still once mining expands into the higher-grade Wendy pit.

In October, the mine yielded a record 4,972 oz. gold at an operating cost of US$224 per oz. Prior to June, the company had been mining material from the BT pit.

The reserve grade at Farley Lake averages 3.9 grams gold per tonne, compared with 2.7 grams at BT. As well, the waste-to-ore ratio at Farley Lake is lower than at BT.

Reserves at Farley Lake stand at 1.4 million tonnes grading 3.9 grams gold, from which 39,000 oz. will be extracted in 1996, rising to 58,000 oz. next year.

In the third quarter, 124,890 tonnes grading 2.87 grams gold were milled and Black Hawk sold 9,414 oz. gold, resulting in $4.9 million in revenue. The company recorded a loss, however, of $614,134 (or 1 cents per share). For the comparable period in 1995, Black Hawk incurred a loss of 721,146 (1 cents per share) on revenue of $1.6 million.

In the recent third quarter, Black Hawk issued 13.6 million shares to acquire Granduc Mining. It also issued 14.3 million shares as a result of a $10-million equity financing completed in the second quarter.

Meanwhile, at the company’s Hoyle Twp. properties, east of Timmins, Ont., deep drilling has comfirmed multiple zones of gold mineralization to a depth of 407 metres.

A development agreement allows Kinross Gold (K-T) to earn a half interest in the property from Black Hawk.

The resource at Hoyle Twp. stands at 697,484 tonnes grading 11.28 grams gold.

Outside of Canada, at the Bald Mountain copper-gold deposit in northern Maine, the company is working toward completion of a feasibility study.

Tests performed on gossan samples indicate that 85% of the gold can be recovered in 24 hours by means of vat leaching.

Reserves at Bald Mountain stand at 1.1 million tonnes grading 4.5 grams gold and 103 grams silver.