NEWS RELEASE
Emgold Mining Corp -
Idaho-Maryland gold mine back into production; website
Emgold Mining Corp EMR
Shares issued 11,337,903 1998-08-11 close $0.29
Tuesday Aug 11 1998
Mr. Frank Lang reports
The company has made significant progress in bringing the historic Idaho-Maryland gold mine back into production. Recent engineering studies indicate that less than half of the known gold has been extracted from the deposit, and that a resource of three million ounces remains at the minesite.
The Idaho-Maryland gold mine was discovered in 1851, and was in nearly continuous production from 1862 through 1956. Total recorded production from the mine was 2,383,000 ounces of gold from 5,546,000 tons of ore (0.43 oz/t recovered grade).
The mine closed in March 1956 due to escalating labour and material costs coupled with a gold price fixed at $35 (U.S.)/ounce. At the time of closure, mining operations were under way at 25 different faces on six different levels.
The most significant production stope in the Idaho-Maryland mine was the Idaho No. 1 ore shoot, which was worked continuously from a depth of 100 feet to a vertical depth of over 2,000 feet over a downrake distance of 5,500 feet. Between 1862 and 1894, the Idaho No. 1 shoot produced over 1,000,000 ounces from less than one million tons of ore, a production record that has only been exceeded by one mine in the entire world (the Oroya oreshoot of the famous Kalgoorlie Golden mile in western Australia).
The Idaho-Maryland vein system is 9,000 feet long, up to 3,000 feet wide, and has been partially mined from surface to a vertical depth of 3,280 feet. The Grass Valley (California) district is noted for good quartz vein continuity (both horizontally and vertically).
Access to the mine's 15 working levels is provided by the three compartment, 3,460 foot deep New Brunswick shaft. Over 71 miles of underground tunnels and workings provide access to much of the property. The Idaho-Maryland mine has been partially developed and mined from 160 veins, while another 55 veins were partially delineated (but had no production) by drilling prior to 1956. The historical database includes the results of over 42 miles (220,000 feet) of exploration and development drilling.
The Idaho-Maryland vein system ties within the wedge shaped confines of three bounding faults. A 3D geologic model demonstrates the potential for continuity of the existing vein system to a vertical depth of 5,000 feet (the adjoining Empire mine produced 6,000,000 oz Au to a depth of 5,200 feet). The area between 3,280 and 5,000 feet is considered highly prospective for the discovery of additional high grade gold-quartz vein deposits.
A 1994 study by James Askew Associates estimated that the remaining combined in situ gold resources and potential gold mineralization of the Idaho-Maryland mine are 9,117,500 ST at 0.326 oz Au/ST (containing 2,968,400 oz Au). This resource estimate excludes the potential for large, bulk tonnage targets identified by Emgold in 1997.
Emgold's plans for reviving the Idaho-Maryland mine are to first de-water the mine, and then go underground to do further exploration to prove up the total resource potential.
The entire development program (including de-watering, shaft rehabilitation, headframe and hoist construction and initial underground drilling of the known resource blocks between the 2,000 and 3,280 foot levels) is expected to cost approximately $11-million (U.S.).
Emgold has applied for and been granted all permits necessary for re-opening the New Brunswick shaft, de-watering the mine and completing a bankable feasibility.
Emgold plans to resume operations at the Idaho-Maryland mine at an initial mining rate of 1,500 ST ore/day, which will produce approximately 140,000 ounces of gold per year. With the addition of a second shaft, it would be possible to significantly increase production. At 5,000 ST/day, the Idaho-Maryland mine would produce between 350,000 and 400,000 ounces of gold per year (on par with Golden Giant and David Bell mines of the Hemlo district of Ontario).
Recent studies indicate that the Idaho-Maryland mine could be profitably developed and operated at a long-term gold price of $300 (U.S.)/oz based on an estimated operating cost (excluding capital and royalties) of $215 (U.S.) per ounce. The accessibility of higher grade ore zones (>0.50 oz Au/ST) in the initial years of operations will significantly enhance both the mine's profitability and Emgold's earning per share.
In order to further investor awareness, the company has established a new website: www.emgold.com.
Additionally, the company is seeking to obtain senior financing to continue its development of the Idaho-Maryland mine at Grass Valley, California.
Mr. Lang also reports
The company has engaged Gold Ridge Investments of Surfside, Florida to provide advertising, email services and banner ad placements of the contents of the above news release. The fee paid for this service was $20,000 (U.S.).
(c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com
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