Camrico likely to reopen Goldlund mill at Sioux

Based on some highly encouraging recent drill findings, coupled with the results of the past year’s extensive drill program, Camreco Inc. (TSE) is giving serious consideration to re-opening the Goldlund mill in Ontario’s Sioux Lookout area, The Northern Miner gathers.

This 400-ton plant was acquired in 1986 when Camreco took over all the assets of the bankrupt Goldlund Mines, including the latter’s mine and 83-claim gold property on which some $20 million had been spent. (Goldlund is now a wholly-owned subsidiary of Camreco.)

Before running into its serious financial difficulties which forced mill and mine closure, Goldlund had produce about 15,000 oz of gold and reported reserves of around 200,000 tons grading 0.18 oz.

The adjoining Camreco mine, which has its own shaft but which is interconnected underground to the Goldlund workings, reports reserves of around 300,000 tons with a cut grade of 0.17 oz.

However, initial mill feed would likely come from the former Goldlund open pit, which the recent drilling has extended. Hole 88-31, collared 1,300 ft ea st of the Goldlund shaft and drilled at –70 degrees to test the footwall of the eastern extension of the pit intersected 107 ft from 47-154 ft that averaged 0.250 oz uncut or 0.188 oz cut grade.

No. 88-32, 530 ft east of the shaft at –59 degrees to test the western pit extension, intersected 37.7 ft from 37.3-75.0 ft that ran 0.07l oz.

With the present economics of gold, Camreco now has a good potential of becoming a profitable gold mining operation, says President Matthew Gaasenbee in the annual report. Since virtually all capital expenditures for declines, shafts, underground development and mill have already been made, future additional capital expenditures should be modest, likely not exceeding $5 million, he adds.

As of March 31, the company’s consolidated financial statement shows cash and term deposits on hand of $2,918,000.