120,000 oz gold in 1988 at Mascot’s nickel Plate

The Nickel Plate mine of Mascot Gold Mines here is among the largest open pit gold mining operations in North America and is producing the yellow metal for the third time since 1902.

At the official opening last Monday (for which some 800 guests received invitations) Peter Steen, chairman, predicted the property’s “third golden age will be the best one yet.”

Admitting the key to its reincarnation was the recognition of the property’s open pit potential, he suggested that underground mining might resume one day again as well.

Without flow-through capital the mine probably wouldn’t be there. This financing option allowed Mascot to conduct a vigorous exploration program in 1984 which outlined some three million tons of open pit reserves and altered the economics of the project dramatically. Until that time, exploration was geared towards the underground potential only.

The reserve base was expanded further and a preliminary feasibility study was completed based on an 1,800-ton-per-day treatment plant which was later bumped up to 2,700 tons. Within 14 months of the go-ahead decision, the mine was in production, something President Henry G. Ewanchuk describes as “one of the quickest mine developments in Canada.” And he predicted the mine will “last a lot longer than even we think it will.”

Mr Ewanchuk complimented British Columbia Premier Bill Vander Zalm and his government for their speedy approval of the project. The former received a gold- plated lapel shovel from the premier and Mr Ewanchuck reciprocated by presenting Mr Vander Zalm with an actual shovel. (The premier is an avid gardener but one pundit suggested he might be able to use it in the political arena as well.)

After the ceremonies Mr Vander Zalm told The Northern Miner that future government support for the industry will include less red tape and a more equitable tax regime that probably would be profit based. In general the province’s mining industry has been impressed with the premier’s economic policies and his tough approach to organized labor.

Mascot is non-unionized and employee participation in the project is fostered through a stock purchase plan. That way they share in the risk as well as the benefits associated with a winning proposition. It’s capitalism at its best and some Mascot employees are known to arrive well before shift change, unheard of in most other operations. 10,000 oz per month

According to Mascot, capital costs including indirect costs and interest totalled approximately $61.5 million and production should average about 10,000 oz per month in 1988. Mill tune-up is almost complete and throughput is now averaging around 2,450 tons per day and grades from 0.13 oz to 0.14 oz gold per ton. Higher grade sections including old mine pillars have been encountered in the mining sequence which at times boosts the head grade to 0.2 oz gold, said one Mascot official.

The mining rate is currently 27,000 tons per day but the average was 30,000 tons in July. Oxide ore, which has caused problems in the mill, is being stockpiled and this material might be leached at a later date on a small-scale basis. Ore grade material requires grinding to –400 mesh because the gold is so finely disseminated in the ore. The optimum recovery rate is expected to be 89% using the Merrill-Crowe zinc dust process and smelting to produce dore bullion on site.

Reserves are currently calculated to be 8.3 million tons at 0.14 oz gold and the first gold pour took place April 22. With the only mill in the region, Mascot is well positioned to secure other properties adjacent to its mine and indeed several joint venture agreements have been signed this past year.

Site clearing began in May, 1986, and by year-end all buildings had been erected and all major machinery was in place on the new foundations. Construction continued through the winter and the crusher started in January, mill commissioning in March, and the project was brought on-stream under budget and ahead of schedule.

The project was funded by a gold loan from the Canadian Imperial Bank of Commerce, representatives from which attended the opening ceremonies. In addition to securing the loan agreement, at least one of them managed to secure a Mascot jacket which he said cost $70 million. In any event, it was a good deal for Mascot and hopefully even better for The Commerce.

Gomer P. Jones, Nickel Plate’s first mine superintendent at the turn of the century, probably summed it up better than any of his contemporaries could: “To a mining man this is a splendid task, creating wealth out of the ground, beneficial to all and injurious to none, especially if the mine is successful, as the Nickel Plate had been and now is.”