Malartic-Sud starts hauling ore at Croinor (July 19, 2004)

South-Malartic Exploration (MSU-V) will start production from the Croinor gold property, 70 km east of Val d’Or, Que., this month, following a custom-milling agreement with Richmont Mines (RIC-T).

South-Malartic plans to ship 65,000 tonnes of ore from Croinor to Richmont’s Camflo mill, near Val d’Or, for processing between July and December. Pit models used in feasibility work predict a grade of 5.47 grams gold per tonne.

The company also engaged a mining contractor, Norascon, of Amos, Que., to perform all mining and to truck the ore to Camflo. Another contractor, Ross-Finlay, has been engaged to drive a decline from the base of the Croinor pit.

Croinor has a measured and indicated resource of 2.5 million tonnes at a grade of 3.46 grams gold per tonne.

In late May, South-Malartic consolidated ownership in Croinor in a deal to buy out 30% partner Huntington Exploration (HEI-V), which is turning itself into a pure oil-and-gas company. The deal brought all of Huntington’s mineral properties into South-Malartic in exchange for 1.5 million shares of South-Malartic and 1.5 million warrants, exercisable at 60 for two years from closing.

That deal requires approval from Huntington shareholders, and is scheduled to close near Aug. 1. The South-Malartic shares are to be issued in 100,000-share blocks in each of the first six months following closing, with 50,000-share blocks released monthly until all have been issued.

South-Malartic gets the Croinor land package and Huntington’s Tex-Sol property near Val d’Or, where Cambior (CBJ-T) is to spend $350,000 over three years. Also in the deal are properties in Ontario, Quebec, Nova Scotia, and the Northwest Territories; the most advanced is an exploration-stage base metal property in the Sturgeon Lake region of northwestern Ontario, where Inmet Mining (IMN-T) holds a 67% interest.