Manitoba cheers New Britannia opening

Second-hand hoists, second-hand mill. The New Britannia mine, which officially opens this week, has both. Scouring the mining industry’s garage sales for bargains is one way to keep capital costs down, and to bring a second-hand orebody back into production after a long wait.

Operator TVX Gold (TSE) and equal joint-venture partner High River Gold Mines (TSE) might not be too proud to buy used, but they are definitely proud of New Britannia, the second new mine to open in the Snow Lake area of northern Manitoba this year. (The first was the Photo Lake mine of Hudson Bay Mining & Smelting, which started up in September.)

New Britannia is also the second mine to operate on the same property, and from the same orebody. The Nor-Acme mine operated from 1949 and produced 620,000 oz. gold. But by 1958, costs had risen to meet the gold price and leasehold operator Britannia Mining & Smelting closed the mine. It left the property to Nor-Acme Mines, which tried diligently, during the succeeding 30 years, to prove more tonnage. Nor-Acme’s careful preservation of drill logs and other development information from those years turned out to be important in later exploration.

In 1987, Nor-Acme dealt an option on the property to High River Gold Mines. High River dewatered the workings, and drilled from the lowest accessible levels of the mine. The holes intersected enough mineralization to interest Inco Gold in taking an option from High River, but after delineation work the deposit was abandoned. Nor-Acme was merged into High River late in 1988.

When TVX took over Inco Gold’s interest in 1991, the option was allowed to lapse, but a 1994 joint-venture agreement between TVX and High River took the deposit to the feasibility stage.

TVX’s decision, in January 1994, to buy the equipment from Asamera Minerals’ Cannon mine in Wenatchee, Wash., helped to make New Britannia a feasible mine. The Cannon mill had a grinding and flotation circuit identical to the old Nor-Acme mill, so there was no doubt it would do the job; and TVX got it, f.o.b. Snow Lake, for US$5 million.

The purchase of the Cannon mill equipment saved the project about $4 million and six months in construction time. The deposit went from feasibility to production in 16 months: the first ore was hauled in August from a decline at the No. 3 zone, an orebody on an adjacent property acquired from prospector Bruce Dunlop and consolidated with the Nor-Acme property.

To develop the new Nor-Acme ore zones, the existing 1,960-ft. shaft was deepened to 3,300 ft. Extensions off the new shaft have been driven at the 3,000-ft. level for development and at the 3,100-ft. level for a crusher station. A pair of used hoists from the Denison mine at Elliot Lake, Ont., were bought for about 20% of the cost of new equipment. They can handle 4,000 tons per day from a 6,000-ft. depth, about twice the capacity New Britannia needs.

Manitoba’s streamlined mining approvals process got good reviews from TVX and High River management. At the opening, John Hick, president of TVX, said “We’re very pleased with the co-operation we’ve received from the Manitoba government . . . If we see another opportunity in the province, you can be damned sure we will follow up on it.” High River’s president, Donald Whalen, was equally complimentary: “In my opinion there is no better place to do business than Manitoba.”

Cutting the ribbon at the official opening was provincial Mines Minister Darren Praznik, who invited the companies to take full advantage of Manitoba’s pro-mining atmosphere. “We want TVX and High River to have more than one facility in Manitoba, and we’re going to work with you toward that goal,” he said, adding that the opening of mines in the province “sends the message that Manitoba is the best place in Canada for mining.” New Britannia has minable reserves of 4.2 million tons grading 0.17 oz. gold per ton, all above the cutoff depths of 3,000 ft. in the Britannia zone and 400 ft. in the No. 3 zone. Mineralization below those levels will be brought into reserves as development continues, and both companies are bullish on the deposit’s potential. High River’s Whalen alluded to a 15-million-ton prediction by Lew Parres, Nor-Acme’s president before the High River merger, and said, “We’re going to prove you right, Lew.” Hick of TVX concurred: “We’re confident that we’re looking at a mine that will go well beyond 10 years.”

The gold deposits at New Britannia are in quartz-carbonate replacement zones in volcanic rocks. The replacement zones, which can be up to 100 ft. thick, are developed near north-dipping faults that splay off a relatively shallow reverse fault that strikes roughly southeast. The gold occurs as free gold grains with arsenopyrite and other sulphides.

The deposit is chiefly being mined by open-stope longhole blasting. Waste rock is being backfilled in areas mined out before Nor-Acme closed in 1958, and will ultimately go into empty production stopes. Access to the zones below the 1,780-ft. level is available from a ramp that will extend to the 3,000-ft. level. Drilling levels are being established every 50 ft. across the ore zones, which will be mined by longhole stoping. The mine produces about 1,850 tons per day, and the mill can handle 2,000.

The process uses ball and rod mills, a conventional cyanide-leach circuit, and carbon-in-pulp recovery. Cyanide in mill waste water is broken down using the Inco sulphur dioxide system. The capital cost of the project was about $50 million, and mine life is expected to be eight years on current reserves. Capital plus operating costs are projected to be US$260 per oz.