Kerr Addison completes gold study

A preliminary engineering study has been completed for the Harrison Lake gold project 60 miles east of Vancouver. The report was commissioned by Kerr Addison Mines, project operator, which holds a 25% interest in the property. Joint venture partners include: Bema International Resources with 35% and Abo Resources with 40%. Bema has concluded an agreement to take over Abo so its actual interest will be higher.

The study is based on a minimum 2.65 million tons of mineable reserves and a potential of 4.4 million tons from the Jenner stock, one of several mineralized structures on the property. Sub-level caving was indicated to be the optimal mining method and operating costs were projected at approximately $17.43(US) per ton based on a production rate of 1,100 short tons per day.

Kerr Addison is compiling all the results from the 1987 underground program. A total of 1,146 ft of development drifting and raising was completed and sampled. Face and rib samples from a 120-ft-wide-by- 213-ft-long zone plus an additional sub-parallel zone averaged 0.1 oz gold per ton. The footwall zone containing these panels projected from surface to sea level contain 2.4 million tons.

Based on this tonnage and grade, and assuming a 90% recovery rate and previously stated operating costs, production is projected at 35,400 oz per year at a unit cost of $190 per oz with a 10-year mine life. Excellent potential exists for additional mineable tonnage within the Jenner stock, the joint venture believes. The actual production rate could, of course, be increased with higher reserves.

The companies are proposing an aggressive exploration and development program for 1988, including extensive underground drilling and drifting. The work should begin this March.