Pamour group heating up gold excitement in Timmins

Miners have been pulling gold ore out of the ground here for more than 75 years. But the excitement of finding new gold orebodies has never been stronger than it is today — thanks largely to the Pamour group of companies.

For years, much of the prospective ground in the Timmins, Schumacher, South Porcupine area has been controlled by Pamour. With five producing mines on the go (two open pit and three underground), this long-time operator has traditionally been reluctant to allocate funds to exploration.

Until now. As vice-president exploration for the reorganized Pamour group, Tony Ransom has pulled together a 5-man team of geologists which is rethinking the geology of the area and coming up with some excellent exploration targets. On the Porcupine property, two targets have been outlined on the extension of ore-bearing structures to the east. The most prospective is at a depth of 3,000 ft and will be drilled shortly. On another target, further east, a machine will begin drilling this week.

“After almost 80 years of mining, it’s amazing how ore controls are so poorly understood in Timmins,” says Mr Ransom, who is also president of Toronto-listed Pamorex Minerals.

One of the positive effects of the recent reorganization of Pamour is that Giant Yellowknife Mines (Pamour’s operating arm) won’t have to finance the exploration out of operating profits. Instead, funding will come from a combination of flow-through financing, cash flow from the recently opened Bell Creek mine and equity financing.

Last month Giant Resources of Sydney, Australia, acquired 1.4 million shares of Giant Yellowknife at $28.25 per share, giving the Australian company a 16% interest in Giant Yellowknife. Giant Resources already holds a 50.2% controlling interest in Pamour. This, together with the recent merger of Pamour with Giant Yellowknife Mines, has placed some bullish men in control, including Robert Needham, a former managing director of Placer Pacific. Their management philosophy, geared to rationalization and growth, is starting to revitalize this famous old camp. 180,000 oz in 1989

The five producing gold mines in Timmins, which now fall under the umbrella of Giant Yellowknife’s Timmins division, will produce 120,000 oz of gold this year. But several capital-intensive projects have begun, which will bring that total up to 155,000 oz in 1988 and 180,000 oz in 1989, says general manager Peter Rowlandson.

“We expect to recover a couple of thousand ounces this year from our heap leaching operation,” he says. “That should increase to 9,000-10,000 oz next year.” The carbon columns, used to recover gold from pregnant heap leach cyanide solutions, are in place and should be operating next week. Bullion should be poured next month.

Giant has decided to go ahead with the $3-million, 6-year project to treat some 2.9 million tons of marginal-grade material averaging 0.029 oz gold per ton in the company’s No 3 pit. A total cost of $7 per ton is required for crushing the ore to — 3/8-inch and loading it onto the pads for leaching. This compares favorably with the heap leaching operation at the Hope Brook Gold mine in Newfoundland, which is roughly the same size. 50,000 tons per month

An additional 3.6 million tons of 0.06-oz-per-ton material will be mined from the No 3 pit over the coming years. Mining rates are now about 50,000 tons per month with 30,000 tons going to the Schumacher mill and 20,000 tons to the No 1 mill. Total mining and milling costs are $392(C) per oz. But major capital expenditures over the next year (for larger, 50-ton trucks, bigger shovels and larger-diameter blasthole drills) should lower costs significantly.

Highway 101, which stretches over the eastern extension of the No 3 orebody, may have to be relocated out into Three Nations Lake to allow mining of this reserve.

Underground at Schumacher, $1.5 million is being spent to drive a new ore pass from the 2,800- to 1,000-ft level. The present ore pass is causing ore handling problems because of caving and hang-ups. New underground equipment is also being purchased to speed up stope development.

An estimated 70% of the revenues from this mine comes from what were known as salvage stopes — mined-out stopes which were filled with waste rock grading 0.075 oz gold per ton back in the 1930s and ’40s. Giant Yellowknife is now mining that with a modified caving method.

At the Ross mine, 31 miles east of here, Giant is driving a decline below the bottom level of the mine to test the hypothesis that the five ore stockworks converge into a single pipe at depth. A major 10-20,000-ft drilling program from the 5,200-ft level will commence by year-end, says mine manager Charles Brown.

Broken reserves in the mine stand at 128,500 tons grading 0.115 oz gold per ton. Unbroken, proven reserves are 419,000 tons at 0.117 oz.

If the pipes do come together at depth, an internal shaft will be extended to surface to provide added hoisting capacity over the current 700-ton-per-day mark.

The fourth expansion project in Timmins is the $65-million tailings retreatment facility of ERG Resources. Site clearing for the 1.1-million-ton-per-month mill is under way in preparation for foundation work. A test water-monitoring machine has been set up to allow the company to get a feel for the high-pressure water machine.

Site clearing has also started on the new tailings facility which will contain tailings from the erg mill. Government permits are coming in and construction should begin soon. The mill is expected to be in operation by next summer, says project director Frederick Thomson.