Kirkland suspends Macassa (March 10, 2003)

The failure of a pillar between an ore pass and shaft 3 has forced Kirkland Lake Gold (KGI-V) to suspend production at the Macassa mine, west of Kirkland Lake, Ont.

A seismic event caused damage to a 60-metre vertical section of the south wall of the shaft. The ground support contained most of the expelled rock, but the timber shaft sets became mis-aligned.

The company notes that the ore pass, which sits about 9 metres from the shaft, had been enlarged by a previous operator at the expense of the pillar.

Says President Brian Hinchcliffe: “Regrettably this collapse came just as we were building momentum in our fiscal fourth quarter, and we were planning the largest production for the year. However, the site management and employees have responded in superb fashion and the required rehab work is under way. Accordingly, we will have to reduce our fiscal 2003 production forecast to 30,000 to 35,000 ounces. Fortunately, sufficient surface ore exists to maintain gold production, albeit at a reduced rate.”

Late last year, the company dropped its annual gold production estimate to the lower end of the 50,000-70,000 oz. previously forecast, owing to a slower-than-planned dewatering campaign.

The latest incident has not affected pumping, and the level of water in Shaft 3 remains about 24 metres from the 4900 level. Dewatering efforts have shifted to controlling the bulkhead at the 4250 level. Ultimately, crews will dewater down to the 5700 level.

Repairs to the shaft are ongoing, and the company expects to resume mining, at higher production levels, by mid-March.

Drilling from the 3835 level recently resumed. The company is following up on hole 38-181 which returned 59.3 grams gold per tonne (including abundant visible gold) over a true width of 2.7 metres. The mineralization was encountered 150 metres away from any previous drilling, 90 metres above the 3800 level. The new intercept is different in that it is hosted by volcanic tuffs and porphyry instead of conglomerate, like the lower intercepts.

So far, drilling has traced the new zone along strike for about 245 metres and downdip 42 for nearly 400 metres. The zone remains open in all directions.

Earlier this year, Kirkland Lake Gold unveiled a new proven and probable reserve estimate of 726,000 tonnes grading 15.4 grams gold per tonne, or 356,300 oz. gold for the past-producing mine. An additional measured and indicated resource is estimated at 2.8 million tonnes grading 10.6 grams gold per tonne; there is also an inferred resource of 407,000 tonnes grading 9.3 grams.

The estimates used cutoff gold grades of 8.6 grams and 12 grams per tonne (0.25 oz. and 0.35 oz. per ton), depending on the location of the mineralized zone.

Kirkland Lake Gold took over the Macassa mine and mill from Kinross Gold (K-T) in December 2001. The deal also included the adjoining Lakeshore, Wright-Hargreaves, Teck-Hughes, and Kirkland Minerals properties.