McAdam Resources aims to be back in business soon

Back in June of this year, McAdam Resources (TSE) discovered that a surface crown pillar over an old, mined-out stope at its McWatters property near here was only about 7 ft thick. Worse still, it found that the old mine workings had affected the stability of the 400-ft-deep shaft.

Underground exploration was immediately halted (at a time when the company was drifting into gold mineralized ground in an unworked portion of the mine) and Golder Associates, specialists in rectifying pillar problems, was called in. At one point, it seemed that McAdam would have to sink a new shaft just to carry on with underground exploration. Fortunately, that won’t be the case.

A Quebec government mine safety agency is satisfied that, with the proper remedial work, McAdam’s exploration crews can continue using the shaft for access.

“We’re back in business,” said John McAdam, president of the fledgling exploration outfit. “We’re going to block off one of the compartments in the shaft and put in strategic bulkheads to isolate the old workings from the new.”

That work should be finished some time this month. Crews will then go underground to continue driving exploration drifts into the J, K and L zones that were discovered last year. McAdam said that three underground diamond drill rigs will also be probing the structures, which sit to the northwest of the existing shaft in ground that hadn’t been touched during previous mining. (Interestingly, old mine records show that the former owners started testing the area with diamond drills from underground, but they abandoned the project a few hundred feet short of the new mineralization. The mine closed in 1945.)

The zones run parallel to the famed Cadillac Break and have been tested by McAdam to the 400-ft level. It is open along strike, as well. Sampling from a drift in the zones ran 0.3 oz gold per ton across the full 7-ft width of the drift. Proven or possible reserves have yet to be established, but with the new round of exploration, McAdam hopes to prove up at least 200,000 tons grading 0.2 oz gold. The aim is to start mining as quickly as possible for early cash flow.

For production to proceed, McAdam would have to sink a new shaft. Because of the old workings, it may be possible to use an Alimak machine to excavate a raise/shaft to surface and slash out to whatever diameter the shaft would require. This would be cheaper than the conventional shaft-sinking method.

The delay at McWatters has catapulted McAdam’s Spud Valley play on Vancouver Island into the lead property in the company’s portfolio. An old producer as well, Spud Valley has a proven, probable and possible reserve of 247,000 tons grading 0.41 oz gold. That figure should be revised soon, once results from recent exploration are tabulated.

Exploration drifting continues at the property on the Goldfields vein, a narrow, high-grade quartz vein that averages one foot in thickness. This fall, McAdam will scale up the operation to try to confirm continuity at deeper levels of the Goldfield and a branch vein called the Spur. Test milling is targeted for March of next year.

In other news, the planned amalgamation with Tashota-Nipigon Mines (VSE) and Quinteko Resources (ASE) should occur by November, McAdam said. Tashota- Nipigon and McAdam are partners in the Spud Valley play. McAdam, Tashota-Nipigon and Quinteko are involved in the McWatters project.