American Reserve funds Porcupine gold

A $15.2-million exploration program at Associated Porcupine’s Paymaster gold property near Timmins, Ont., will be funded by American Reserve Mining under a joint venture agreement.

Using flow-through exploration funds, American Reserve can earn a 50% interest in the property by financing the surface and underground exploration program, with the eventual aim of placing the property into production at a rate of 500 tons per day.

Approximately $2.7 million will be spent initially on 33,000 ft of deep hole drilling. Two rigs will be on-site in December.

The Paymaster mine operated from the mid-1930s to 1966 when mine workings were closed and flooded. The mine is partially developed to 6,025 ft and reserves to that level are calculated at 800,000 tons grading 0.227 oz gold per ton (cut and diluted) and 141,000 tons grading 0.142 oz in the older part of the mine.

The drill program, with Associated Porcupine as operator, is aimed at finding additional reserves down to 6,900 ft. Work will also begin on dewatering the shaft and underground workings. Further exploration is planned late in 1988 from two new levels at 6,175 ft and 6,325 ft.