St Andrew suspends production at Nixon Fort

Ore production issues are behind a suspension of production at St Andrew Goldfields’ (SAS-T, SASXF-O) Nixon Fork gold mine in Alaska.

St Andrew said that it has been running into difficulty in the upper portion of the 3300 zone of its Crystal deposit because the geometry of the mineralized zone is much different than the reserve estimated.

The temporary suspension will give St Andrew time to continue delineation drilling in the 3000 and 3300 zones “to better define the irregular geometry of the gold mineralization for improved future mining recovery and dilution,” the company said in a recent release.

Jacques Perron, who began his tenure as the company’s president and chief executive on Oct. 1, was unavailable for comment.

The company started mining the Crystal Garnet mine in the fourth quarter of 2006. Initially, the company estimated that the Nixon Fork property would achieve an annual production rate of 40,000 oz. gold starting in 2007. At that production rate, based on existing gold resources, the company forecast a mine life of three years.

But the project has been somewhat problematic. In August, St Andrew shut down its milling operations for about six weeks to modify its mill circuits.

Ongoing construction of its cyanide leach facility and the installation of a dry tailings disposal system will also be suspended.

St Andrew’s reserve estimate (compliant with National Instrument 43-101) demonstrates a proven reserve of 47,000 tonnes grading 34.1 grams per tonne containing 51,500 oz. gold. Probable reserves stand at 137,500 tonnes grading 18.6 grams per tonne, containing 82,230 oz. gold.

The resource estimate reveals a measured resource of 23,400 tonnes at an average grade of 36.8 grams gold per tonne, containing 27,700 oz. at a cutoff grade of 21 grams gold.