Century eyes Sigma revival (January 17, 2005)

Preliminary results from ongoing reverse-circulation drilling by Century Mining (CMM-V) suggests that grades at the Sigma mine in Val d’Or, Que., may be up to 20% higher than originally estimated during due diligence work.

So far, Century has sunk about two thirds of a planned 12,000-metre close-spaced RC grade-control drill program. Highlights from drilling on 4.6-metre centres on lines spaced 9.2 metres apart include 19 metres grading 11.1 grams gold per tonne, 5.5 metres running 26.2 grams, 7.3 metres of 7.2 grams gold, and 1.8 metres averaging 71 grams gold. In all, about 23% of some 3,517 assays returned so far exceed a cutoff grade of 0.85 grams gold.

Century also says the latest results suggest that the mining of 25% fewer tonnes of ore would not significantly impact on life-of-mine gold production. The drilling has also outlined clear ore/waste boundaries, which supports the use of selective mining rather than the bulk mining methods employed by the previous operator Mc Watters Mining.

Century plans to combine the RC-drilling results and data derived from the milling of the first 250,000 tonnes of ore processed to upgrade current resources to a National Instrument 43-101-compliant reserve figure. At the end of 2002, Sigma’s open-pit reserves were reported at 10.3 million tonnes grading 2.7 grams gold per tonne. A subsequent review by Australian independent consultancy firm RSG Global failed to confirm that figure.

Initial plans at Sigma call for the milling of a maximum of 5,000 tonnes per day. A new three-month open-pit mine plan is currently being optimized, with production slated to begin in February. Grade control will continue to employ RC drilling, with mine plans covering three months of production. Century says that McWatters Mining’s previous practise of using blast holes for grade control failed to minimize ore dilution.

Most of the mine’s technical staff are in place, and the company has arranged leases for a new mining fleet. The smaller equipment will allow for more selective mining of Sigma’s narrow-vein ore. Owing to delays in delivery of the equipment, 2005 production is pegged at around 90,000 oz. at a cash cost of about US$290 per oz.

Century acquired the Sigma-Lamaque mine property from McWatters in September for $25.9 million worth of cash, shares and debt-assumption.