Lower head grades at its flagship El Valle open-pit mine in northwestern Spain have taken a bit of the edge off the production numbers of
During 2000, Rio Narcea produced 97,016 oz. gold at an operating cash cost of US$202 per oz., compared with 103,785 oz. at US$185 in 1999.
Head grades fell by 0.7 gram, to 4.6 grams gold per tonne, while gold recovery rates decreased slightly to 89.7%. The company made up for much of this by boosting mill throughput 8%, to 723,588 tonnes. During the fourth quarter, gold production reached 29,336 oz. at a cash cost of US$169 per oz., compared with 31,680 oz. at US$180 in 1999.
Rio Narcea introduced a new mine plan at El Valle, accelerating waste removal in order to develop the high-grade Charnela zone by the end of 2001. The company is now mining Charnela’s uppermost portion within the El Valle pit and will move to the Boinas East pit in April.
Under the new mine plan, and with the nearby Carles mine coming on-stream, Rio Narcea expects to produce a total of 125,000 oz. gold in 2001 at a cash cost below US$190 per oz.
Despite the weak gold price, Rio Narcea remains committed to exploring its El Valle, Corcoesto and Oscos projects in Spain and its Penedono project in Portugal.
Last year at El Valle, the company drilled 42 holes totalling 8,972 metres in order to define the minable portions of the Charnela and Sienna zones and test extensions of both zones below the open pits.
Of note, hole 1005 intercepted 5.5 metres of the Charnela zone grading 25 grams gold and 43.6 metres of the newly discovered North Black Skarn zone grading 3.2 grams gold. The hole has given the Charnela zone a vertical extension of 210 metres and extended North Black Skarn 141 metres west of discovery hole 1001. The latter zone remains open in all directions.
Hole 170 intercepted a new high-grade zone named Caolinas below the northwest corner of the El Valle pit. From a down-hole depth of 54 metres, the hole cut 49.5 metres of 24.4 grams gold, including 18.9 metres of silicified and kaolinized granite and garnet-skarn breccia assaying 62.6 grams gold. Two rigs are now delineating this new zone.
At Corcoesto, Rio Narcea completed 1,600 metres of infill drilling in 37 holes, proving the continuity of mineralization in the Cova Crea and Pozo dal Ingles zones, and at Oscos, the company flew 1,000 line km in an airborne geophysical survey.
Geologists at Penedono carried out trenching, sampling and soil surveys, identifying a large gold target associated with tungsten in greisens and intrusive-related quartz-vein systems.
In December, Rio Narcea suffered a major setback when
Before Barrick’s withdrawal, the joint venture completed 3,400 line km of airborne geophysical surveying in the Rio Narcea and Navelgas belts and drilled 26 holes totalling 10,848 metres to test individual targets and probe the region’s deep stratigraphy and structure.
Emphasizing the positive, Rio Narcea say the program “achieved an important first step toward the discovery of new deposits in the area.”
Like many in the business, Rio Narcea is branching out beyond gold: the company signed an option agreement with Spain’s Atlantic Copper to acquire a half-interest in the Aguablanca nickel-copper-platinum-group-metals project in the Extremadura province of southwestern Spain.
Aguablanca is currently held by a consortium made up of Atlantic Copper and the Spanish government. If Rio Narcea acquires Atlantic Copper’s interest, the consortium’s bylaws will enable Rio to acquire the government’s interest.
Under the new agreement, Rio Narcea must complete a positive due-diligence study at Aguablanca before June 29.
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