La Ronge area to attract $65m. spending in 1988

A 6-year exploration boom in the La Ronge area of northern Saskatchewan, has opened up a new gold mining camp. According to Claude Resources (TSE), one of the major players here, $65 million will be spent on gold exploration and development this year — that’s in contrast to the less than $3 million spent in 1982.

The largest development in progress is the $20-million Jolu gold mine project operated by Corona Corp. (TSE). Corona and Mahogany Minerals Resources (VSE) hold a 30% and 70% interest in the project respectively.

With reserves of 606,000 tons grading 0.4 oz gold per ton, the project is expected to produce at least 50,000 oz of gold per year beginning in 1989.

Project financing has been arranged by Corona in the form of a 35,000-oz gold loan with Barclay’s Bank of Canada. Mining will be via a 6,000-ft decline ramp, which provides access to the 800-ft level.

Mahogany is also involved with the Fork Lakes gold project which is the site of a $6-million underground exploration progam. Discovered by the Saskatchewan Mining Development Corp. (SMDC) in the summer of 1987, the property hosts, like Jolu, high grade gold mineralization. Project partners include SMDC 36%, Golden Rule Resources (TSE) 30%, Mahogany 19% carried interest and Shore Gold Fund 15%. The mineralized zones at Fork Lakes strike on to another property known as Transom Lake. Combined reserves total 175,000 tons grading 0.72 oz.

High grades are a characteristic of this part of the La Ronge belt. The first gold mine in the area, Star Lake, entered production in early 1987 with 250,000 tons of reserves grading 0.5 oz. Still in operation, the mine is owned by partners SMDC, 50%, Uranerz Exploration and Mining 15% and Starrex Mining Corp. (TSE) 35%. Star Lake is located one mile south of Jolu and three miles north of the Fork Lakes discovery.

Another major underground effort is being carried out by Placer- Dome Inc. (TSE) on Claude’s Seabee property located 78 miles northeast of La Ronge. Reserves total 2.1 million tons grading 0.185 oz. Following the completion of 3,000 ft of decline and raise development, Placer is expected to complete a mine feasibility study this year.

By 1990, the camp could be producing more than 125,000 oz gold per year from the Jolu, Seabee and Star Lake mines. The main 21 zone at Star Lake will be mined out by then, but additional feed for the 220-ton-per-day mill is expected to come from the Transom and Fork Lakes properties and from other nearby deposits in which SMDC holds an interest.