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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (62874)	1/23/2001 8:43:08 AM
From: long-gone	Respond to of 116759

Cyanide Use Planned For Gold Mine Ouray Landowner Would Need Permits For Heap Leach Process Source: Denver Rocky Mountain News Publication date: 2001-01-21 Arrival time: 2001-01-23 Ouray property owner Frank Baumgartner plans to revive the historic Red Mountain mining area with a new operation that uses cyanide to extract gold. "With all the world currencies in bad shape, gold will become more valuable than money," Baumgartner said. Gold currently sells for about $300 an ounce, near its historic 30- year low and below the cost of most mining and milling. The price topped $800 an ounce in the 1980s, which is the inspiration Baumgartner said he needs. Baumgartner, an engineer in international mining, would have to obtain permits from Ouray County and the state to operate the mine and install a cyanide heap leach on the 200-acre parcel. Heap leach mining involves extracting ore and piling it in a heap, where it is sprayed with a cyanide solution that leaches the gold from the rocks. The solution is recovered at the bottom of the heap, then piped through a process that separates gold from cyanide. Plastic liners under the heap prevent leaks into the ground, but rips in the plastic can occur, as happened at Summitville. "Mining would be wonderful for the county, but (Baumgartner) would have to convince the county that a cyanide heap leach would be in the best interests of the county," County Commissioner Alan Staehle said. "There is a pretty sad story of heap leach operations in Colorado. Summitville comes to mind," Staehle said. "Mr. Baumgartner would have to convince us that he would do it right and cooperate." The Summitville Mine, a high-altitude venture near Del Norte, went into bankruptcy in the early 1990s after leaking acid, which killed life in most of the Alamosa River. The cleanup cost the federal government more than $150 million. But Baumgartner insists that heap leach mining is safer now than it was in 1970s and 1980s. "With all the new technology and requirements, it would be impossible for anything to happen," said Baumgartner, who owns about 1,600 acres on the San Juan Skyway between Ouray and Silverton. A similar mine - the Cresson Mine - obtained local and state permits and opened near Victor and Cripple Creek. "There have been many changes in permitting requirements since Summitville," said Loretta Pineda, spokeswoman for the Colorado Division of Minerals and Geology. "The permit would hinge on his reclamation plan." Baumgartner's mine would be above 12,000 feet, but he would avoid the effects of weather problems - which afflicted the Summitville operation - by using triple liners in the leach pond and limiting the use of cyanide to the summer months. The old mining district includes the Camp Bird Mine, Colorado's richest gold mine in the early 1900s. Baumgartner said the Red Mountain No. 3 has a proven reserve of 400,000 ounces of gold and silver worth millions. He said he plans to drill test holes this spring in another area of the mine site and expects to find up to 2 million ounces of gold and 60 million ounces of silver. The Yankee Girl mine produced $91 million in silver and gold in the early 1900s. Mining started in 1882 and expanded beyond gold to silver, lead, zinc and copper. The silver panic of 1893 ended the boom, but gold mining continued there through the 1970s. Baumgartner broached the subject of mining in the 1990s, after the Summitville disaster, but public reaction was hostile and gold prices were dropping. He estimated the new mine and leach field would cost more than $50 million and employ about 120 people. "It's getting harder and harder to permit mining operations in the state," said Jim Cappa, a geologist with the Colorado Geological Survey. "No matter where it is, there is going to be opposition. "But Mr. Baumgartner is used to dealing with opposition," he added. "The real question is how much it costs to get it out of the ground and out of the ore and what price gold is selling for." Publication date: 2001-01-21 © 2000, YellowBrix, Inc. cnniw.yellowbrix.com