Patricia revives Island Gold project

Dubreuilville, Ont. — High grades at Patricia Mining‘s (PAT-V) Island Gold property, northeast of Wawa, Ont., are raising hopes that the area could see production again.

Exploration has focused on the northeast-trending Goudreau Lake deformation zone, which is dotted with several former gold producers within the Michipicoten greenstone belt. The area last saw major activity in the late 1980s, when Canamax Resources (now defunct) built and operated the underground Kremzar mine. Operations were halted in 1990, after less than two years, by which time Kremzar had produced 46,000 oz. gold with a head grade of 4.7 grams gold per tonne. The deposit was mined to a depth of 240 metres, leaving 350,000 tonnes of reserves on the books.

Kremzar is included in the current project area, which also comprises the Lochalsh and Goudreau properties, for a total of 2,228 hectares. Patricia Mining has a 100% interest, subject to royalties, in all but the Goudreau property, in which it holds 53.4%.

In early 2002, inferred resources were pegged at 20.6 million tonnes grading 2.35 grams gold, or 1.6 million oz. gold, at a cutoff grade of 0.75 gram gold per tonne. The estimate, which is compliant with National Instrument 43-101, includes the Lochalsh, North Shear and Centre zones over a 2-km segment in the southern portion of the property to an average depth of 250 metres. The Kremzar mine has an additional 181,944 tonnes grading 6.27 grams gold in the proven and probable category, plus 85,952 tonnes grading 8.67 grams gold in the possible category, though these are not compliant with NI 43-101.

The scoping study, performed by engineering company AMEC last autumn, concluded that bulk-tonnage mining is viable if resources are expanded.

Funding for Patricia’s latest drill program, budgeted at $2.5 million, is coming from Richmont Mines (RIC-T), which has expertise in mining narrow high-grade veins. Richmont can earn a 55% interest in the Island Gold project by investing $1 million in Patricia Mining through a private placement and either putting the project into production or spending another $10 million on development work. By the end of September, Richmont must decide whether or not to proceed with development.

The current program is focused on the Island-Lochalsh zone and includes drill-testing and drifting.

Patricia will calculate a revised resource estimate of the area that encompasses the Lochalsh, Island, Goudreau and North Shear zones. The goal is to confirm potential for 500,000 tonnes grading 8 grams gold, which would support three years of production at the daily rate of 650 tonnes.

Near the former Kremzar portal, which has been blocked, sits a mothballed, 650-tonne-per-day carbon-in-pulp plant. Restarting the mothballed Kremzar mill and the Island Gold mine could be achieved within 18-24 months at the annual rate of 55,000 oz., Patricia says.

Mine facilities include a mill, a crusher and a ball mill, and the company is considering adding a Knelson concentrator to recover the coarse gold.

Results from underground drilling continue to show excellent vertical and horizontal continuity. All seven recent definition drill holes contained visible gold and numerous high-grade intercepts from four sub-parallel zones. The vein structures can be correlated over 100 metres downdip on two sections spaced 40 metres apart, and all the gold-bearing zones remain open at depth.

Zones C and D contain intersections ranging from 1 to 5.4 metres, with hole 7 returning 1.9 metres of 77.18 grams gold per tonne. Zone E1 has intersections ranging from 1.1 to 2.9 metres, with hole 9 returning 2.9 metres of 50.34 grams gold. Zones E2 and B returned 0.8-to-2-metre-wide intercepts, including hole 11, which assayed 177.02 grams gold over 1.5 metres in Zone B.

“These results are very encouraging because they show continuity and really good grades,” says Patricia Mining President J.P. Chauvin. The previous results were also impressive, as they included visible gold in all five holes drilled. Gold grades ranged from 11.45 to 30.07 grams over a minimum of 1.5 metres.

Geology

The Island Gold property is in the Michipicoten greenstone belt, along a regional east-west-trending structure that extends to Kirkland Lake and parallels a similar structure that runs between the Timmins camp and Hemlo mine.

Drill crews are testing two discrete, gold-bearing alteration envelopes representing some 80 metres of volcano-sedimentary stratigraphy that lie south of the Webb Lake granodiorite sill complex. Most gold mineralization occurs in steep, southerly dipping, northeast-trending, smoky-grey quartz veins associated with a wider band of sericitic and biotitic alteration. The visible gold was found in north-trending quartz-tourmaline veins hosted by intermediate-to-mafic volcanics.

Canamax developed the Lochalsh ramp toward the Island zone to maintain a source of feed for the mill, as the Kremzar mine was running out of ore. A 4,251-tonne bulk sample collected from the zone graded 6 grams gold from the 125- and 140-metre levels.

The former management of Patricia did a mainly-cash deal in 1996 for $3 million to secure the property. A financing by Research Capital funded an aggressive exploration program, but it was not geared towards mining. However, at around this time, the industry was beset by the Bre-X scandal and falling gold prices.

Patricia decided to preserve the asset intact and maintain the facilities.

“We looked at a bulk-tonnage model with 1.5 million ounces as a development scenario,” says Chairman Richard Sutcliffe. “Now we think our best shot at developing this deposit is for an accomplished narrow-vein-miner like Richmont to operate the mine.”

Meanwhile, Montreal-based Golden Goose Resources (GGR-V) was sufficiently encouraged by exploration success at Island Gold that it decided to revive its former-producing Magino mine. The property produced 114,000 oz. gold between 1988 and 1992, and the remaining resource consists of 5.8 million tons grading 0.09 oz. gold per ton, based on a 0.05-oz. cutoff.

The nearby Edwards gold mine, formerly held by River Gold (RIV-T), lies 1 km east of Patricia’s property boundary. The mine was closed in 2001 because of low gold prices and subsequently sold to Strike Minerals (STK.H-V).