Magino reserves upped by Muscocho, McNellen

A deep drilling program has resulted in a dramatic increase in reserves at the Magino gold mine property shared equally by partners Muscocho Explorations (TSE) and McNellen Resources (VSE). Located near Goudreau, Ont., the property hosts proven, probable and possible reserves of eight million tons grading 0.25 oz gold per ton, the partners say.

This reserve estimate is based on drilling to 2,000 ft. Prior to the deep drilling program, reserves were calculated at two million tons grading 0.25 oz to a depth of 500 ft.

However, the vast majority of the additional reserves are in the possible category and remain to be proven up by drilling and underground exploration. Also, the drill results, upon which the increase in reserves is based, have yet to be released by the companies.

As a result of the increased reserve base, the partners are discussing the possibility of expanding the mill capacity from 400 tons to 600 tons per day.

Since acquiring a 50% interest in the property in 1985, Muscocho has greatly enhanced the project, building reserves, a mill and surface facilities. The culmination of this work was the pouring of the first gold bar in June. The gold was produced from low-grading stockpiled surface ore which was mined during the development phase.

McNellen’s share of mine capital costs was funded by Echo Bay Mines (TSE) which holds a 26.6% interest in the company on a fully diluted basis. Also, two Echo Bay officers will be added to the company’s board of directors.