Eldorado To Restart White Mountain

A dispute over alleged water contamination that shut down Eldorado Gold’s (ELD-T) White Mountain gold mine in China’s Jilin province for five months has been resolved and the company says it expects to ramp-up to full production quickly.

A group of local farmers forced the Vancouver-based company to shut down the mine in August until water issues were resolved. The operation is “now able to discharge treated water under an approved change to the Environmental Impact Assessment,” the company said in a statement.

During the shutdown, development work on underground access to the mine continued.

Eldorado owns a 95% interest in White Mountain, with the remainder held by its local joint-venture partner, the Jilin Tonghua Institute of Geology and Minerals Exploration and Development.

White Mountain was built during 2008 for about US$465 million. The underground mine uses a sub-level open-stoping method for portions of the ore body that are thicker than 10 metres and steeper than 55 degrees, a benching method for thicker portions and a cut-and-fill method for the remainder of the deposit.

Eldorado acquired White Mountain from Sino Gold in December 2009, with commercial production having begun in January 2009. In the first nine months of 2009, the mine produced 25,751 oz. gold at a cash operating cost of US$478 per oz.

At full capacity, the mine is expected to produce an average of 65,000 oz. gold annually.

The White Mountain processing plant is a standard Chinese design carbon-in-leach plant.

A major north-east trending regional fault zone hosts the deposit, with mineralization extending along a known strike length of about 1.5 km.

Metallurgical testing has identified both non-refractory and refractory ore, with recoveries of 85% and 65% for each type, respectively. The production schedule is based on about 10% of the ore being refractory.

Sino Gold discovered the gold-deposit in 2004, although the area is also known for its coal and iron ore mining.

In addition to China, Eldorado has gold mines and advanced projects in Brazil, Greece and Turkey.

At presstime, Eldorado was trading at $15.47 per share. Over the last year it has traded in a range of $8.13-$15.89 per share and now has 536.9 million shares outstanding.