Inter-Rock and Rayrock advancing Daisy project

Shareholders attending the recent annual meeting of Inter-Rock Gold (ME) were told that the Daisy gold project in Nevada should be up and running by late 1996.

Engineering work and permitting are under way, and construction is expected to last six to seven months, with the initial construction cost estimated at US$5.7 million.

Daisy is operated by Rayrock Yellowknife Resources (TSE), which owns 25% of the project. Inter-Rock, an affiliate of Rayrock, holds the remaining 75%.

Underlying the 12.5-sq.-mile property are four sulphide and/or oxide gold deposits which trend in an east-northeasterly direction. The Secret Pass, Mother Lode, Sunday Night and West Zone deposits have a combined mineral inventory of 49.1 million tons averaging 0.025 oz. gold per ton at a cutoff grade of 0.005 oz. per ton.

Over the past year, infill drilling has been carried out at the Secret Pass deposit. Based on drill results and a gold price of US$400 per oz., a minable reserve of 17.9 million tons averaging 0.021 oz. gold has been defined. Included in this figure are 2.5 million tons of sulphide reserves averaging 0.044 oz.

Metallurgical tests suggest this sulphide ore can be broken down using sulphuric acid and bacterial oxidation. The byproduct could then be placed onto pads and, along with the oxide ore, undergo cyanide leaching.

It is estimated that 75% of the gold in sulphide ore, and 82% of the gold in oxide ore, is recoverable.

Inter-Rock and Rayrock are preparing to take a 10-ton bulk sample from the bottom of the Mother Lode pit to confirm recoveries from that deposit. The test should last six to seven months.

It is estimated the Secret Pass deposit will yield 35,000 oz. per year over a mine life of eight years, at a cash operating cost of US$294 per oz. The project’s mineral inventory is large, and drill programs are planned for two of the three remaining deposits, as well as one exploration target.

Drills are already turning at the West Zone deposit, where Rayrock hopes to convert some of the mineral inventory of 700,000 tons grading 0.027 oz. per ton into minable oxide reserves.

In addition, drilling will outline a higher-grade sulphide deposit in the Mother Lode pit, which at present has an inventory of 9.4 million tons averaging 0.046 oz. per ton.

A geochemical anomaly northeast of the Mother Lode pit will also be subjected to drilling.

In total, exploration and feasibility programs will cost about US$1 million.

At the annual meeting several shareholders criticized management for not keeping them abreast of developments. Management responded by noting that news releases were available at the head office and that all developments were summarized in quarterly reports sent to all shareholders.

Inter-Rock Vice-president David Hutton added that “infill drill programs don’t generate a lot of news because they’re generally not very interesting. There’s no excitement in telling people you’re still working and obtaining permits.”