Development work halted at Komis gold mine

The recent slump in gold prices has led to a decision to curtail development work at the Komis gold mine in Saskatchewan.

Waddy Lake Resources, a wholly owned subsidiary of Golden Rule Resources (GNU-T), began feeding ore from the project to a nearby mill last September.

However, production through to the end of 1996 (60,000 tons averaging 0.22 oz. gold per ton) has fallen short of feasibility study estimates, owing to a shortfall in overall gold grades.

Larry Lahusen, vice-president of Golden Rule, says the shortfall is “primarily due to excess dilution caused by ore zone configurations being more complex and generally less predictable than originally interpreted.” He also notes that the original blast-hole stoping methods created openings that were broader than desired.

Golden Rule’s technical staff is currently reviewing the 1996 production history of the underground operation, including tons produced, grade and operating costs.

A new reserve calculation is also being completed, along with an assessment of the cost of developing those reserves.

The review is expected to take about 30 days to complete, during which time mining operations will continue.