NEVADA SPECIAL — Construction under way at Pipeline

The current exploration boom in Nevada owes much to the discovery of the Pipeline gold deposit 100 km southwest of Elko.

The discovery prompted a flurry of exploration activity in the region, besides boosting the prospects of the Cortez joint venture, which owns the deposit.

The Cortez project, which is now owned 60-40 by Placer Dome (PDG-T) and Kennecott, began life in 1969 as an open-pit gold mine. It was the first Nevada gold producer to employ heap-leaching as a stand-alone method of treatment.

With permits in hand, Placer Dome has started building a combined carbon-in-leach (CIL) mill and heap-leach facility for the Pipeline deposit.

Construction and commissioning of the US$319-million facility will take place over 15 months, with production scheduled to start in mid-1997. When up and running, the open-pit mine will produce an average 310,000 oz. gold annually for 12 years.

Placer Dome’s share, in the initial stage, will be 250,000 oz. per year, with a cash production cost estimated at less than US$110 per oz. (the lowest in the Placer Dome group).

The Cortez has undergone numerous improvements over its 27-year history. In 1981, the milling process was converted to CIL from standard Merrill-Crowe.

And in 1990, a dry-grinding plant and circulating fluid-bed roaster were constructed for the purpose of oxidating refractory ores before they are processed.

In 1994, a shallow oxide portion of the South Pipeline deposit was brought into production, and, in 1995, the Cortez process plant began co-treating carbonaceous ore from the Gold Acres deposit and the Crescent pit.

At the end of 1995, the Cortez joint venture hosted proven and probable reserves of 7.3 million oz. gold (which includes the Cortez mine and the Pipeline deposit) in 82.3 million tonnes grading 2.8 grams gold per tonne.

The property also hosts resources (excluding ore reserves) of a further 3.3 million oz. gold (including Pipeline and South Pipeline) in 71.3 million tonnes grading 1.4 grams gold.