Skyline commissioning mill at Johnny Mountain project

Mill commissioning is under way at Skyline Explorations’ (TSE) Johnny Mountain property north of Stewart, B.C., according to R. E. Davis, president. He says that commercial production is expected to “occur during the next quarter.”

In the meantime, the company is deferring all expenditures net of any income for accounting purposes. During the six months ended April 30, expenditures of $6.7 million were incurred on mine development and approximately $2.9 million for equipment and construction of mine facilities. Second quarter spending amounted to $3.1 million for development and $1.2 million for plant and equipment.

Skyline recently obtained a $5.5- million bank line of credit for mill construction, mine development and working capital, pending cash receipts from gold sales.

Davis says the mill will produce three types of product: a gold gravity concentrate, a copper concentrate containing gold and silver, and a gold/silver dore bar.

Results from underground stoping have demonstrated the high grade nature of ore shoots on the property. Broken ore from the 11-16C area diluted to a 4.6-ft mining width averaged 3.62 oz along 80 ft of strike length. This is based on sample results from the first three lifts. Drilling has indicated an extension of the 16 vein 50 ft below the first lift in the stope. One hole returned 2.4 ft of 0.21 oz gold, 2.5 ft of 4.7 oz and 2.8 ft of 0.39 oz, all of which ran consecutively. In total, the intercept length was 7.7 ft at a grade of 1.7 oz.

Diamond drilling is expected to begin shortly at the Red Bluff and Red Bird crown grants which are several hundred metres northeast of Delaware Resources’ Twin zone.