Lenora confident on Box mine, finding PGMs on adjoining bets

After a 17-year career with Cominco, which ended in frustration four years ago, Dr Ian Mason is excited about doing geology again.

He’s onto something, here on the north shore of Lake Athabaska. But it involves the precious metals gold, platinum and palladium — not uranium, which was mined here by Eldorado Resources at the Beaverlodge mine as recently as 1982. How big it is he doesn’t know for sure yet, but his geological instincts say it could be big. As he told The Northern Miner on a visit to the area, he’s “excited as hell.”

Dr Mason is working as an independent consultant for Lenora Explorations and Mary Ellen Resources, two juniors run by entrepreneur Bob Kasner of Kirkland Lake, Ont. Mr Kasner got a “golden opportunity” last November to expand his company’s property holdings out of the Harker-Holloway area of Ontario and the Casa Berardi area of Quebec, into the gold areas of northern Saskatchewan by optioning a 60%-interest in the Box mine property — an underground gold operation that pulled 1.4 million tons out of the ground between 1939 and 1942 at an average grade of 0.048 oz gold per ton. That property is being optioned from Cominco, the previous mine operator. Box/Anthona mine potential

Mr Kasner is confident his company can turn this, and the adjoining Anthona property, optioned (for 51%) from coats-listed New Anthona Mines, into two low-cost open pit mines, feeding one simple flotation mill, which could be built, probably within three years. Preliminary studies, based on mining two million tons per year from the Box deposit alone, show a $43.5-million mine and mill could produce 61,000-96,000 oz of the yellow metal per year at a cost of about $260-400(C) an oz. The uncertainty arises in determining the grade of the deposit.

Dr Mason is certain the grade is at least 0.033 oz gold per ton, but it could be as high as 0.052, he says. Geostatistical work and results of trenchi ng, done this summer, should nail down the grade within 3-4 months at which time a feasibility study will be done. Depending on the mining rate and stripping ratio chosen, mine reserves range from 9-18 million tons.

Heavy equipment could be brought into the site across the ice of Lake Athabaska this winter.

Gold in the Box deposit occurs as free gold, so recoveries of 92% are expected with straight flotation.

Ian McIvity, president of mvp Capital, which is providing flow- through capital to Lenora and Mary Ellen, is confident about the Box/ Anthona mine possibility as well. “Being so low grade it’s going to be a good little play for the investor on the price of gold,” he says. Potential on other ground

But its the potential for finding more precious metals orebodies in the metamorphosed terrain around Beaverlodge Lake that has Mr Kasner and company excited. The Box and Anthona mines could, in part, provide the capital for more exploration in the area where the two companies have option agreements with the Saskatchewan Mine Development Corp., Urangesellschaft Canada and Cominco.

After reading a technical paper by Dr Mason, which draws comparisons between this area and the site of recent gold discoveries at Coronation Hill and South Alligator River in Australia, Mr Kasner immediately hired Dr Mason to supervise Lenora’s exploration program in the area.

Dr Mason has been on the project, off and on since April directing mapping, trenching and sampling programs on showings scattered throughout a 250-sq-mi area. But in his words, these things can’t be rushed. It takes time to understand the geology and put the whole puzzle together — especially when you find platinum and gold where you don’t expect to find it. All of the traditional geological indicators used in Precambrian greenstone belts don’t exist here. The only thing Dr Mason can say for certain is that there appears to be certain structures, usually at the contact between quartzites and volcanic rocks, associated with uranium, certain structures associated with gold and certain ones associated with platinum. “Where your lucky, you find areas where the gold and platinum structures coincide. Gold and platinum don’t occur anywhere else in the world like here. And we don’t know why, yet.

“We simply can’t go as fast as the brokers on Bay Street would like us to.”

One such area that’s just starting to get interesting is in a small moss and tree-carpeted gully between a ridge of quartzite on one side and amphibolites on the other. Grab samples collected along a 400-m section of this 5-6-km structure returned the high assays reported in The Northern Miner last week. And channel samples, collected from an inch-wide cut made by a circular diamond saw assayed 1.13 oz gold, 0.047 oz platinum and 0.088 oz palladium.

This week one drill will be set up on the quartzite ridge to probe the unit at depth. Two other machines have been lined up by Lenora and should be on the other good bets in the immediate area within months, Mr Kasner says.

The property was drilled by Eldorado in the past while looking for uranium.