Looking to add to gold reserves at its Pamour operation in the Timmins district of Ontario, Royal Oak Mines (TSE) has acquired a controlling position in Ronnoco Gold Mines, which holds three claim blocks next to Royal Oak’s Nighthawk Lake property.
Royal Oak has been assembling a land position in the Nighthawk Lake area, with the intention of increasing reserves for the Pamour mill. Royal Oak now controls a land package containing the entire Nighthawk Lake Break. This fault splays from the main Destor-Porcupine Break, which hosts the large gold deposits of the Timmins camp.
Ronnoco’s properties include a deposit with a geological resource of 4 million tons grading 0.1 oz. gold per ton. Current minable reserves at Royal Oak’s Nighthawk Lake mine, now under development, are estimated at 869,000 tons grading 0.17 oz. gold per ton. Including geological resources, the mine’s total mineral inventory is 243,000 oz.
Royal Oak continues to mount a major exploration effort on the Nighthawk Lake Break, where seven zones of gold mineralization are known. Drilling in 1994-1995 intersected mineralized zones with drilled lengths of 14 to 66 ft., and with grades ranging from 0.05 to 0.26 oz. gold per ton. A high-grade zone, intersected recently from a barge on the lake, ran 2.27 oz. per ton over 18.1 ft. This mineralization is believed to be on the same structure as the Ronnoco resource.
The Nighthawk Lake mine, scheduled to start production in the last quarter of this year, is expected to produce 33,000 oz. yearly. Other sources of feed for the Pamour mill are in the exploration and development stages.
At the Pamour mine site, the company is investigating the feasibility of constructing an open-pit gold mine. About 20,000 ft. of drilling have been completed from surface, and underground drilling will begin shortly.
Development continues at the Matachewan project, 50 km south, which is scheduled to begin producing gold in 1998. The geological resource is estimated at 12.8 million tons grading 0.09 oz. gold per ton, of which 1.4 million tons grading 0.06 oz. constitute a measured, minable reserve.
Royal Oak will control 2.4 million shares in Ronnoco, representing 87% of the outstanding equity. The purchase price was $1.1 million.
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