News that Great Basin Gold (GBG-T, GBN-X, GBG-J) has processed the first ore from its Hollister mine in Nevada sent the company’s shares on the Toronto Stock Exchange up 15 apiece to $3.57 per share in mid-day trading.
The company has a 52-week trading range of $1.98-$3.83.
The 5,000 tons of ore was processed last month at Newmont Mining‘s (NMC-T, NEM-N) Midas mill, 20 miles from Hollister.
Head grades are expected to vary during the build-up phase, but the Midas mill, which uses direct cyanidation, counter-current decantation and a Merrill Crowe recovery system, processed the ore with a head-grade of 1.2 oz. per ton and a silver head grade of 9.5 oz. per ton.
After toll treatment costs of US$45 per dry ton and a recoupment of capital amortization costs by Newmont, Great Basin Gold achieved net revenue of US$3.9 million.
Gold recoveries were 84.7% and silver 94.3%, yielding a total of 4,644 oz. gold and 42,539 oz. silver.
A second stockpile of about 5,000 tons of ore is expected to be processed this month.
The construction of an Alimak raise from the 5200 level to the surface in the first quarter of the year and commissioning of the escape-way in May enabled underground production to start with stoping on the deposit’s Gwenivere and Clementine veins.
The near-surface Hollister deposit is a large low-grade gold system in Miocene volcanic rocks on Nevada’s 80-km-long Carlin Trend gold belt.
The deposit hosts classic Carlin-style low sulphidation epithermal banded quartz veins in Ordovician sediments containing high grade precious metal values.
Hollister has a measured and indicated resource of 930,000 tons grading 1.03 oz. gold per ton and 5.71 oz. silver per ton. The inferred resource is 805,000 tons grading 1.08 oz. gold per ton and 3.04 oz. silver per ton, both at a 0.25 oz. per ton cut-off.
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