A feasibility study recently completed on the Holloway project near Matheson, Ont., indicates that the Lightning zone gold deposit could be economically developed based on a 1,650-ton-per-day operation, says Freewest Resources President Mac Watson.
Although details of the study results have yet to be released by project operator Noranda Minerals, Freewest’s 1991 annual report says a decision to go underground is expected in the near future.
The study’s recommendations were in the process of being approved by various levels of management when The Northern Miner contacted the Noranda offices on Sept. 17.
The Holloway project is a 60-40 joint venture between Noranda subsidiary Hemlo Gold Mines (TSE) and Freewest.
At the proposed production rate, and assuming a head grade of 0.25 oz. per ton with 90% recovery, the Lightning zone would produce about 120,000 oz. gold per year.
The economics of the Holloway project have been under review since last winter, when Noranda released a possible and probable reserve estimate of 5.25 million tons grading 0.24 oz. per ton for the Lightning zone. A separate feasibility study is under way on Teddy Bear Valley Mines’ (CDN) adjacent property to the south. The Teddy Bear claims host the downdip extension of the gold-rich zone.
Surface drilling on the Lightning zone was suspended in July, after Noranda encountered weak mineralization at the eastern extension of the deposit. Although the alteration package associated with the zone continues to plunge to the east, a new theory would have the gold zone trending in a vertical to near-vertical fashion.
Watson expects surface drilling to resume shortly.
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