NA Palladium searches for gold around Sleeping Giant

As North American Palladium (PDL-T, PAL-X) gets its Lac des Iles palladium mine near Thunder Bay, Ont., up and running again, the company is starting an active exploration and development program at its gold projects in Quebec.

North American plans to spend $6.2 million on gold exploration, drilling a total of 53,000 metres.

The company is also spending $6 million to deepen the shaft at the Sleeping Giant gold mine 80 km north of Amos, Que., which just reached commercial production on Jan. 10. The company wants to deepen the shaft by 200 metres, adding three more mining levels. North American anticipates about 50,000 oz. gold will be produced at Sleeping Giant this year.

“Our exploration program in Quebec is aimed at increasing mine life at Sleeping Giant,” said North American president and CEO William Biggar in a statement. “We are also exploring for new gold deposits in the area, so that we can capitalize on our Sleeping Giant mill, which as excess capacity.”

As a result of this extra capacity, much of the exploration budget will go toward drilling in and around Sleeping Giant. The company plans to spend $2.1 million drilling 30,000 metres in the underground mine to define and extend the zones within the mine and at depth.

On top of that, North American plans to do about 3,500 metres of diamond drilling from surface at Sleeping Giant, plus some reverse-circulation drilling of overburden and some geophysical surveys.

Next door to Sleeping Giant is the Dormex property where the company will spend $1.2 million on RC drilling, geophysical surveys and a 7,000-metre diamond drill program.

North American is hoping to identify the source of a gold anomaly in overburden detected last year when the company drilled 21 RC holes.

And 70 km east of Sleeping Giant is the Discovery project where an environmental assessment was completed in late 2009. The company wants to spend about $500,000 here on about 4,000 metres of surface drilling as it works toward permitting so it can explore underground.

North American plans to spend another $400,000 on geophysics and 2,500 metres of drilling at the Laflamme option located to the east of Sleeping Giant. The company believes it might find an extension of Sleeping Giant mineralization on this property.

The company has also earmarked $300,000 for its Flordin property north of Lebel-sur-Quevillon, Que., to finish a National Instrument 43-101 report to upgrade historical resources while adding new data.

North American Palladium asked miners from the Lac des Iles mine to come back to work in December after a year-long shutdown brought on by low palladium prices. The company expects to produce 140,000 oz. palladium per year for the next two years.