Barrick extends Ontario mine life with acquisition
miningweekly.com
By: Liezel Hill
12th April 2010
Updated 4 hours ago
TORONTO (miningweekly.com) - Barrick Gold expects to add about four years of operating life to its David Bell mine, 350 km east of Thunder Bay, in Canada's Ontario province, after buying the past-producing Golden Giant property next door from Newmont Mining.
Three gold mines operated in the Hemlo area, all within two miles of one another on the same orebody, until Newmont closed Golden Giant in late 2005.
More recently, Barrick bought the 50% that it did not already own in the other two, the David Bell and Williams mines, from Teck Resources last year for C$65-million.
The David Bell underground mine was due to close soon, but the addition of resources left behind at Golden Giant will mean operations can continue for another four years or so, said Barrick spokesperson Louis Schack.
Barrick bought the property in exchange for a sliding-scale royalty on future production, he said.
With gold prices significantly higher than when Newmont closed the mine four years ago, the plan is to rehabilitate the underground workings and mine the remaining ore at Golden Giant from the David Bell operation.
The remaining resources at the old mine include remnant ores in and around the shaft zone and various pillars and other remnants of the Newmont operations.
"As the Golden Giant mine lies directly between our Williams and David Bell mines, capital requirements are minimal," Schack commented.
"The three mines are already connected underground and most additional costs will be driven by rehabilitating the workings at Golden Giant."
When the Golden Giant buildings and infrastructure were taken down two years ago, Newmont sold most of the dismantled buildings and equipment to London, Ontario-based Fortune Minerals, which plans to build a gold mine in the Northwest Territories.
At current gold prices, Barrick expects to continue mining at Hemlo at least until 2014, Schack said.
The operations produced 275 000 oz of gold last year, at average total cash costs of $597/oz, and had estimated proven and probable mineral reserves of 1,3-million ounces of gold at the end of 2009.
Barrick, the world's biggest gold miner by both output and market value, has said it expects to produce between 7,6-million and 8-million ounces of gold in 2010. |
