Gold, silver Hecla’s `bread and butter’

Almost shut down for good in 1984, Hecla’s Republic gold mine in northeast Washington probably has the highest head grade (1.5 oz per ton) of any mine its size in North America. Last year, gold output was 80,301 oz and it might have been higher had production not been limited by hoisting and milling capacity.

In a recent interview with The Northern Miner, President Arthur Brown, said Hecla is considering expanding production at Republic above the present milling rate of 275 tons per day. “We are studying a new shaft, new mill, and are looking at optimizing production,” he emphasized.

Proven and probable reserves at Republic stand at 527,000 tons grading 0.86 oz gold and 4.0 oz silver and there is plenty of exploration potential left, he said. Brown also noted that mineral rights have been acquired for a “substantial portion of the land in and near the town of Republic,” which will be explored at a later date.

Meanwhile, work is planned on the Golden Promise area, a vein- type discovery made in 1984, and at the Golden Eagle discovery, 3,000 ft west of the Republic mine, which appears to have some lower grade, bulk tonnage potential. “We plan to spend $1 million in 1989 to further explore this exciting new area,” he said.

Low silver prices have hurt the company’s Lucky Friday mine at Mullan, Idaho, which he conceded is “not very profitable at today’s prices.” Silver output was approximately 1.8 million oz in 1988 and ore grades have bee n dropping as mining operations move deeper and higher grade stopes are mined out. An underhand longwall mining method is being used to reduce the rockbursts that continue to plague the mine.

Hecla has a 28% interest in the Greens Creek mine, 18 miles southwest of Juneau, Alaska, on Admiralty Island. The mine is operated by BP Minerals America. Now in start-up, the mine will provide Hecla with nearly two million ounces of silver, 15,000 oz gold, and some lead and zinc. Reserves (proven and probable) are 3.5 million tons grading 24 oz silver, 0.18 oz gold, 9.7% zinc and 3.9% lead. “This will be a nice contributor to our income over the next few years,” he commented.

Production is expected to resume later this year at the Apex mine near St. George, Utah, which was purchased from Musto Explorations (TSE) for $5.5 million. Musto will retain a 15% net profits interest in the mine. Changes will be made to improve recoveries in the metallurgical plant for gallium and germanium, both used in high-tech applications. Brown said part of the technology was purchased from Cominco and he predicted Apex “would be profitable in the future.” Canadian claims

Over the years, Hecla has maintained a strong presence in Canada where it has a reputation as a first rate underground mining company. A year ago, Hecla took a 60% option on Acadia Mineral Ventures’ (TSE) Mooseland project in Nova Scotia where a shaft sinking program is under way. Brown expects that program will be completed in the third quarter and a feasibility study will be ready by year-end.

The company has a 43% interest in Granduc Mines (TSE) which holds a 40% interest in the Sulphurets gold project in northern British Columbia. Newhawk Gold Mines (TSE) holds the remaining interest and is operator. A final feasibility study is expected this summer followed by a production decision. Brown said that Hecla has no immediate plans to increase its equity in Granduc which at one point reached 51%. “But we were diluted down by flow-through,” he said.

Almost $2 million(US) was spent last year on Hecla’s Thor Lake beryllium project near Yellowknife, N.W.T., mostly for process technology and marketing studies. Lakefield Research in Ontario completed a $750,000 pilot plant to convert phenacite concentrate to beryllium hydroxide. The plant will provide detailed engineering and processing data required in the construction of commercial facilities. “Marketing is a big problem but we feel the market will grow. But we have to know where we can sell our production,” he said.

Brown felt the “long-term opportunities for exploration in the north country are greater than anywhere else,” pointing out that most of the area is untouched. Hecla has teamed up with Agnico-Eagle Mines (TSE) to explore for minerals in Canada and the United States. Agnico will be operator in Canada and Hecla in the United States. Each company has put money and properties into the venture and Brown said they may eventually float a public company to hold the properties.

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