Miramar mining streamlines Con mine

By world standards, the Con mine is a premier orebody, having produced more than 4.7 million oz. gold since its startup in the 1930s.

The property, situated just south of here, was first staked by Cominco in 1935. The company subsequently sunk the C1 shaft and put a 100-ton-per-day mill into production to process ore from the Con shear. In 1940, the mill was expanded to 160 tons per day. Six years later, the Campbell shear was discovered and, by 1958, this became the source of all mill feed. In 1974, Cominco started sinking the 6,200-ft.-deep Robertson shaft in order to boost efficiency and provide access to lower levels. The shaft was completed in 1977, whereupon production increased to 650 tons per day. Nine years later, in December, 1986, Nerco Minerals bought the mine from Cominco for $62 million and spent about $145 million upgrading operations. This included expanding the mill to 1,000 tons per day, refurbishing the C1-B3 shaft complex and completing construction of an autoclave unit to treat refractory ores.

When Kennecott took over Nerco in 1993, the mine sold to Miramar Mining (TSE) for US$25 million and 1.5 million treasury shares.

On a recent site visit, Michael Surratt, Miramar’s vice-president of operations, told The Northern Miner he appreciates all the money Nerco spent on the operation during its short tenure. Con is viewed as a high-cost producer, with costs (including exploration and depreciation) totaling US$355 per oz. in 1993.

Surratt noted that since buying the mine, Miramar has not spent any funds on capital improvements but, instead, has concentrated on operational changes. The company reduced cash costs to US$294 per oz. in the first quarter of 1994 and plans to bring about further savings.

Mine Manager Robert Spengler noted that costs will be cut considerably by expanding the company’s Blue Fish hydroelectric plant a few miles north of the mine. Generating capacity will be increased to 7.5 MW from 3.5 MW at a capital cost of $11 million, resulting in annual savings of about $3 million, or more than US$20 per oz.

Miramar currently uses about 7.5 MW per year and must buy excess power from the Yellowknife grid. When the autoclave is brought back into production, power consumption is expected to jump to about 9.5 MW per year. Spengler noted that the Yellowknife power is generated by diesel-powered units and, as a result, an increase in fuel costs could have a substantial impact on power rates, making Bluefish that much more attractive.

The Con is accessible by two shafts: the C1-B3 (plus internal ramp) and the Robertson.

Gold mineralization is hosted in quartz-rich veins and lenses within two main shear zones — Con and Campbell. Ore shoots dip at about 60 to the west and range in thickness from 6 to 60 ft.

Dean McDonald, chief geologist, stressed that the exploration potential of the Con property has only been scratched. Of the 18 miles of prospective shear zones, less than 10% has been drilled on up to 200-ft. intervals and more than 10 miles of shear have never been drill-tested.

Three mining methods are used at Con, including longhole stoping, shrinkage stoping and cut-and-fill, with mining costs in each case averaging $11, $15 and $26-28 per ton, respectively. Year-to-date production breaks down as follows: 33% from longhole; 13% from shrinkage and 55% from cut-and-fill. Part of Miramar’s streamlining strategy includes bulk mining and increasing mechanization to lower costs. It also intends to increase longhole stoping to 40%, increase shrinkage stoping to 20-30% and decrease the more expensive cut- and-fill method to 30-40%. (One area where longhole mining has been used more intensively is in the recovery of remnant pillars below old cut-and-fill stopes.)

Miramar also hopes to reduce costs and lead-time on stope development by using 7-ft.-diameter raiseboring machines. Stope development currently lasts 6-8 months, which the company hopes to cut in half.

Mining costs in the first quarter of 1994 averaged about $18 per ton and processing costs came in at about $22 per ton, resulting in total direct costs of about $127 per ton or about $400 per oz. (US$290 per oz.). Miramar is also planning several changes and capital improvements in the mill. By splitting the circuits into a free-milling and a refractory side, Miramar plans to boost daily throughput to 1,400 tons.

Reserves at Con are generally refractory from surface to about 3,100 ft. at depth, altering to free-milling below that. As of Jan. 1, proven, probable and incremental reserves totaled 3.7 million tons grading 0.31 oz. gold per ton, about a third of which is refractory. The refractory ore nearest to surface will be hoisted up the C-1 shaft, allowing the Robertson shaft to continue hoisting free-milling ore at the rate of 1,000 tons per day. The capital cost of altering the milling circuit is estimated at $3 million and includes a conversion of the gold recovery circuit to a carbon-in-leach system. The changes should increase recoveries by 1-2% and reduce unit milling costs by 10-20%. Gold recovery in the first quarter averaged 93%. Nerco had a great deal of trouble with its refractory circuit, and operating costs exceeded $450 per ton (or more than $1,000 per oz.) before Miramar shut down the area late last year. Although the plant operated at design levels, extreme corrosion in oxygen and vent lines led to a substantial rise in maintenance costs.

The corrosion is related to high chloride levels (2,500 parts per million) in the feed. (Comparable operations, such as Campbell Red Lake, are running successfully at about 300 ppm chloride.) However, by using fresh water (as opposed to mine water) in the separate refractory flotation circuit, Miramar hopes to be able to reduce chloride levels to about 200 ppm. Based on a projected mechanical availability of 80% and a blended feed grade to the autoclave of about 1 oz. per ton, operating costs are projected at $250 per ton or about $250 per oz. The autoclave feed grade is a combination of 2.5-oz.-per-ton float concentrate and 0.45-0.50-oz.-per-ton calcine and arsenic sludge.

The calcine and arsenic sludges are byproducts of Cominco’s old roaster operation, which shut down in 1970. Both pose significant environmental problems in their current form, but, after processing through the autoclave, they will convert to ferric arsenic which is stable and, therefore, environmentally acceptable.

Calcine sludge reserves total 48,000 tons grading 0.45 oz. gold while the arsenic sludge amounts to about 45,000 tons grading 0.50 oz. gold. Changes to the grinding and sulphide circuits, which are intended to boost production to 1,400 tons per day, should be completed by October and the installation of a carbon-in-leach circuit will be finished by September, 1995. Gold output at Con is projected at 130,000 oz. this year and 140,000 oz. in 1995, with cash costs expected to fall to US$250 per oz. by the end of 1995.