Min­ing com­pany seeks OK to bury tail­ings from N.S. op­er­a­tions in N.L. open pit

N.S. ore would be pro­cessed in N.L., says com­pany

Nor'wester (Springdale) - - FRONT PAGE -

It’ll be a hole thou­sands of times big­ger than an Olympic­sized swim­ming pool by the time Ana­conda Min­ing’s Pine Cove pit in New­found­land stops pro­duc­ing in about nine months.

And the ju­nior miner wants to fill it, likely start­ing with the tail­ings of ore from its Guys­bor­ough County’s Gold­boro gold prop­erty about 185 kilo­me­tres north­east of Hal­i­fax, N.S.

Robert Du­four, Toron­to­based Ana­conda Min­ing’s chief fi­nan­cial of­fi­cer, said in an in­ter­view re­cently the com­pany is hop­ing to get the green light to turn the open-pit min­ing op­er­a­tion into a giant tail­ings pit soon.

It’s 150 me­tres deep and 350 me­tres across. Turn­ing it into a tail­ings pit would be a ma­jor coup for the ju­nior miner. An­other tail­ings pit Ana­conda Min­ing just fin­ished build­ing last year cost it $1.9 mil­lion, and is nowhere near that size.

“It would give us the pos­si­bil­ity of 15 years of tail­ings,” said Du­four. “I’ve seen that done else­where and once you fill it back up, you can cap it and veg­e­tate it. It can re­turn to its nat­u­ral state.

“It’s pretty fas­ci­nat­ing to see it af­ter the fact,” he said.

The plan to use the dy­ing open pit mine for tail­ings has been in the works for years. And it comes just as Ana­conda Min­ing is also eye­ing its newly ac­quired gold-rich Gold­boro prop­erty, a de­posit it picked up in a share swap with Orex Ex­plo­ration ear­lier this year. Un­der that deal, Orex be­came an Ana­conda Min­ing sub­sidiary.

The com­pany, which is

still un­der­tak­ing its pre­lim­i­nary eco­nomic as­sess­ment of the Gold­boro site, is buzzing with ex­cite­ment over the results of sam­ples from holes drilled on the prop­erty for geotech­ni­cal and engi­neer­ing work.

Those early in­di­ca­tors sug­gest the Nova Sco­tia prop­erty has ore al­most four times as rich in gold as the stuff be­ing mined at the Pine Cove pit in New­found­land, said Du­four.

“We’ve got­ten the high­est grade of gold ore they’ve ever seen,” he said. “What we can do with Gold­boro is pretty ex­cit­ing.”

That pre­lim­i­nary eco­nomic as­sess­ment is ex­pected to be com­pleted be­fore the end of this year. If it’s a go, Ana­conda Min­ing is plan­ning to mine the ore, ship it to its Pine Cove mill, process it there, and put the tail­ings in the al­ready-built pit.

“We’re look­ing at lever­ag­ing the in­fra­struc­ture we have at Pine Cove,” said Du­four. “All that in­fra­struc­ture is al­ready built. The mill is per­mit­ted and li­censed and there is a tail­ings fa­cil­ity.”

Ana­conda Min­ing’s cur­rent min­ing op­er­a­tion, its Pine Cove pit, which is part of its Point Rousse project near Baie Verte in New­found­land, has just come off a solid year of pro­duc­tion.

Dur­ing its 2017 fis­cal year that ended May 31, the com­pany sold 15,562 ounces of gold, only marginally less than in 2016, even though it mined lower-grade ore.

In 2017, Ana­conda Min­ing took nine per cent more ore out of the ground, but it was a lower grade as the crews went fur­ther down. In­clement weather also lim­ited the mine’s op­er­a­tions to 58 days dur­ing the fourth quar­ter of the year.

That lower-grade ore re­cov­ery is ex­pected to con­tinue through into this year un­til the Pine Cove pit is shut down per­ma­nently. The cur­rent plan is to then move to the com­pany’s nearby Stog’er Tight de­posit in the same Point Rousse project.

De­spite the slight drop in pro­duc­tion, Ana­conda Min­ing recorded a roughly 5.3 per cent in­crease in rev­enues in 2017, up to al­most $25.7 mil­lion from about $24.4 mil­lion the pre­vi­ous year.

Stronger gold prices fu­elled that rev­enue growth, with the com­pany en­joy­ing a nine per cent in­crease in its re­al­ized gold prices — up to $1,651 per ounce from $1,520. Ana­conda Min­ing also gen­er­ated about $938,000 from the sale of waste rock to be used as ag­gre­gate last year, some­thing it did not have the pre­vi­ous year.

The com­pany’s bot­tom line, though, is still in the red.

Ana­conda Min­ing ended the year with a net loss of more than $3.6 mil­lion, up more than 165 per cent from its loss of al­most $1.4 mil­lion in 2016.

Ac­cord­ing to Du­four, the losses stem from the com­pany re-in­vest­ing into its min­ing op­er­a­tions and also high­erthan-ex­pected costs on the books for the de­ple­tion of its min­ing re­sources at Pine Cove and the de­pre­ci­a­tion of that min­ing equip­ment. Those costs rose 36.5 per cent last year.

Ana­conda Min­ing in­vested roughly $3.4 mil­lion from its op­er­at­ing rev­enues back into its mine last year, in­clud­ing about $700,000 for mill up­grades and the $1.9 mil­lion for the new tail­ings fa­cil­ity and a pond to treat waste­water.

The ju­nior miner, whose stock is traded on the Toronto Stock Ex­change un­der the ANX ticker, has a market cap­i­tal­iza­tion of $28.6 mil­lion.

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