Emperor looks to revive former California gold producer

Except for a concrete silo and some old foundations, little is left of the huge Idaho-Maryland mining complex, 2.5 miles east of this small town in California’s Nevada Cty.

But if Emperor Gold (VSE) has its way, the site will soon be brought back to life. The company hopes to revive the site, by first dewatering one of the old shafts and then going underground to assess the feasibility of re-opening the operation.

In 1956, after producing some 2.4 million oz. gold from 5.5 million tons of ore grading 0.43 oz. per ton, the Idaho-Maryland was shut down. The closure was attributed to soaring wage and material costs amid a fixed gold-price environment (US$35 per oz. at the time).

Among historical producers in the Grass Valley area, Idaho-Maryland ranks second only to the adjacent Empire mine, which produced more than 6 million oz. gold before closing in 1957.

The Grass Valley-Nevada Cty. mining district is 7 miles long by 6 miles wide. From 1851 to 1957, lode production from the area totalled more than 13 million oz. gold from roughly 25 million tons of ore grading 0.52 oz. gold.

At the Idaho-Maryland property, a review of mine records has outlined the presence of a significant resource, and, based on historic mining depths in the adjacent Empire mine, Emperor believes the resource can be expanded.

Emperor holds a 7-year mining lease, as well as an option to buy a 100% interest in the Idaho-Maryland property. The lease requires minimum payments of US$100,000 per year and a net smelter royalty ranging from 4% to 8%, depending on the average head grade of future milling operations.

Alternatively, Emperor can buy the 100% interest for US$8 million.

To facilitate exploration at the mine site, Emperor acquired a 3-year lease and option-to-purchase on the nearby Brunswick mill site. The Brunswick asset includes 79.8 acres of surface rights (zoned industrial) and the top 200 ft. of mineral rights, as well as the Brunswick shaft, which will be used to dewater the mine.

Lease payments on the Brunswick can be applied to the US$2-million purchase price.

Consulting engineering firm James Askew Associates estimates that, at best, all of the vein volumes will be minable and that, at worst, 66% will be.

The more optimistic estimate assumes a total resource of 7.2 million tons grading 0.23 oz. gold, including: 256,000 tons of “measured” material grading 0.27 oz. gold; 473,900 tons of “indicated” material grading 0.27 oz.; and 6.5 million tons of “inferred” material grading 0.22 oz.

The less optimistic projection assumes a resource of 2.4 million tons grading 0.23 oz. gold, including: 85,400 tons of measured grading 0.27 oz.; 158,000 tons of indicated grading 0.27 oz.; and 2.2 million tons of inferred grading 0.22 oz.

Previous operators found that drilling and sampling typically underestimated grade, owing to a high nugget effect in the ore.

Emperor reports that gold values within the veins can be extremely erratic, varying from 0.05 to 89.4 oz. gold over horizontal distances of up to 10 ft. on strike.

James Askew reviewed old mine records, comparing drilling and sampling results with actual mine head grades experienced in 1952. The firm determined that actual head grades were about 1.4 times higher than sampling values. Taking this into account, James Askew suggests the grade of the resource could be as high as 0.32 oz. gold.

Gold mineralization in the Idaho-Maryland mine is hosted primarily in quartz-dominated veins and stringers within well-developed, schistose, carbonate-sericite-pyrite, alteration envelopes.

The vein system includes both single vein shears and composite vein lodes, with widths ranging from 1 ft. up to a maximum of 122 ft. in the unmined Brunswick No. 4 vein lode. The average stoping width in the former producer was 5-6 ft., although widths did exceed 50 ft. in at least four areas.

Emperor estimates that 60% of the Idaho-Maryland resource will be contained in vein structures dipping between 50 and 80, with the balance found in veins dipping at considerably less than 45.

All the known gold-producing veins are contained in a triangular block of ground bounded by in-dipping faults on the north and southwest. These form a keel-like zone plunging gently to the southeast. This Keel zone contains 64 known veins, 62 of which have been exploited by mining.

Without a doubt, the most significant stope in the former producer was the Idaho shoot, which was worked continuously from a depth of 100 ft. to a vertical depth of 2,000 ft. over a down-rake distance of 5,500 ft. and a height of about 600 ft.

Between 1862 and 1894, the shoot produced more than 1 million oz. gold from fewer than 1 million tons of ore.

Project Manager Ross Guenther does not expect acid generation to be a concern, pointing out that sulphide concentrations in the system are below 2%. “There are also a lot of carbonates that will act as a buffer,” he adds.

For the time being, Emperor is concentrating on obtaining permits to proceed with dewatering of the 3,280-ft.-deep Brunswick shaft.

In late October, the company received approval of its Final Environmental Impact Report on the proposed dewatering, and expected to receive its permits two weeks later, following a County Use Permit hearing. However, a last-minute appeal by a local residents’ group delayed the hearing. The County Use Permit hearing has been postponed until Jan. 11, 1996.

The residents’ group is concerned that the proposed dewatering will cause the water table to be drawn down as the old workings are pumped out, rendering water wells dry. However, the company does not believe this will happen.

The dewatering involves pumping the water into an existing pond adjacent to the Brunswick shaft, and then discharging it into the south fork of Wolf Creek.

With an unemployment rate approaching 20%, the community is overwhelmingly in favor of the project. Many of the residents worked in the mine when it was in operation, or had family who did so.

The dewatering, combined with exploration work, is budgeted at US$12-15 million. Underground drilling will follow.