U.S. REPORT — Shaft planning under way — Field work begins

Slated for initial production in late 1995 and full production the following year, American Barrick Resources’ (TSE) Meikle mine has moved beyond the study stage. Field work has begun. Rod Pye was appointed project manager less than a month ago and one of his first jobs is to prepare tenders for the three shafts the mine will require. Shaft preparatory work will start early 1993 and sinking by mid-year.

Proven and probable reserves are estimated at 7.2 million tons grading 0.63 oz. gold per ton plus a reserve in the possible category of 700,000 tons grading 0.49 oz. Dilution is estimated at 10% and mine recovery 95%. In all, the calculated reserves contain 4.8 million minable ounces. Pincock, Allen and Holt audited the company’s estimates.

Capital requirements for developing the mine are estimated at US$180 million (1990 dollars) and will be met through existing cash and future cash flow. Mining and processing costs at full production are projected at US$75 per ton or about US$125 per oz. The mine will employ 190 people.

The deposit is open at depth, and, in the upper portion of the orebody, to the northwest. Both areas could lead to an expansion of reserves in later years.

Production is scheduled at 2,000 tons per day and will account for 400,000 oz. gold per year. A minimum mine life of 11 years is estimated. Despite 800 ft. of barren, unmineralized cover, the Meikle orebody is flagged on surface by a prominent soils anomaly. Strong, steeply dipping faults bound the mineralization. Spring waters emanating from the fractures deposited heavy metals in the overburden so creating the telltale anomaly. The discovery hole intersected ore in September, 1989, when it penetrated the heart of the orebody. A 540-ft. intersection returned 0.41 oz. gold, starting at a depth of 1,305 ft.

The deposit’s overall dimensions are 1,200 ft. by 600 ft. in plan and ore extends from 800 ft. to 1,900 ft. below surface.

The upper part is relatively flat and about 100 ft. thick. It is high grade and will be mined first. The central and southern zones are about 150 ft. thick and dip 70. All three zones are interconnected.

Underground water in abundance is a manageable but nevertheless expensive problem in this region of semi-desert.

Like the Goldstrike orebodies two miles to the southeast, the Meikle orebody, and the ground through which the shafts will be sunk, must first be dewatered before any physical work begins.

Water-saturated rocks translate into unstable underground openings and difficult, if not impossible, underfoot conditions. Also, Meikle groundwater temperatures range from 135F to 140F. If hot waters are permitted to flow into the mine, the extra load placed on ventilation and refrigeration circuits will be excessive. The ground must be drained prior to mining and kept dry for the life of the operation.

A series of steeply dipping, clay-filled faults function as water barriers of greater or lesser permeability. They divide bedrock into a series of segments, more properly designated as hydrological domains. If the faults are superior water seals, only a small volume of water will flow from one domain into the one being dewatered.

So far, this has proved to be the case for Barrick. Goldstrike and Meikle are in the same domain and pumping at the one is simultaneously lowering the water table at the other. Neighboring water tables have not been substantially affected. Pumping capacity is to be raised to 68,000 gallons per minute (gpm) from the present 50,000 gpm, and field testing indicates this may be the ultimate capability required.