Resurrecting Carolin mine a challenge to Giant Bay

Resurrecting the trouble-plagued Ladner Creek gold mine of Carolin Mines near Hope, B.C., is something that appears to have challenged Giant Bay Mines.

Giant Bay says it is joining forces with Wright Engineers and has a letter-of-intent with Carolin to evaluate, test and bring the mine, which was closed about three years ago because of technical problems in gold recovery, back into production.

Carolin was most recently in the news when it announced, and then renounced, some spectacular gold and platinum assays reported in the Ladner Creek mine tailings, from test work done this past summer by Intergold U.S.A.

The U.S. firm reported 1.0 oz gold and 0.5 oz platinum per ton in the tailings, which in fact would have meant gold content alone more than 10 times the head grade Carolin achieved in its brief operating history. (N.M., Feb 16/87). Carolin subsequently dissociated itself entirely from Intergold and its results.

Developed in the 1970s and early 1980s at a cost of around $50 million, the Ladner Creek mine’s assets include a 1,500-ton-per-day production facility and related equipment.

Carolin estimates the known mineral inventory at the mine at about 1,000,000 tons grading 0.125 oz and some 800,000 tons of tailings grading from 0.045 to 0.055 oz.

Now, say Giant Bay and Wright, under the agreement with Carolin the joint venture will fund an evaluation and metallurgical test program at the Carolin mine, in a 6-month program expected to cost a minimum $600,000.

Giant Bay President Claus Jensen says once this test program is successfully completed, Wright Engineers will conduct a formal feasibility study, at Carolin’s expense.

Then, on delivery of a positive study, the joint venture will, at Carolin’s expense, redesign, modify and rebuild the production facility to the necessary extent.

As well, Jensen says, the Giant Bay/Wright joint venture will be made operator and receive a management fee.

After payback to Carolin and the joint venture of appropriate costs, including test work, Giant Bay/Wright will receive 15% of the mine cash flow and continue to receive the management fee, he said.

The Giant Bay president points out that his company, with Wright, has developed a proprietary bioleaching process for treating metallurgically difficult gold ore, which he says has proven effective and produced 311 oz gold in a large- scale pilot plant test at the Salmita operation of Giant Yellowknife Mines.

He adds that while the ore treated at Salmita is not the same as Carolin’s ore, it’s believed that bioleaching may enhance gold recovery at the Ladner Creek mine, as well as contribute to solving some environmental problems.