Orex plans to mine Goldboro to prove its economic viability

The area blocked out measures about 137 m long, 50 m wide and 52 m high. It is at the crest of a huge gold-bearing anticlinal structure, only small parts of which have been mined in the past.

The idea, explains senior mine geologist David Hatchette, is to mine 1.07 million tonnes of massive quartz veining which occurs in irregular swarms within a unit of argillite. It is characteristic of the apex of the anticlinal deposit. This material will be used to determine the grade of the mineralization and to conduct metallurgical testing.

Indications are that the property has potential for significantly larger mineable tonnages — about 24 million tonnes, says Michel Roy, vice- president of exploration.

Orex plans to build eventually a 5,000-tonne-per-day open pit on the property but has yet to come up with a sampling technique suitable for grade control. Depending on gold content and metallurgical recoveries, the property could potentially support annual production approaching 200,000 oz (6,220 kg) per year, according to the company.

Gross profits from the bulk test alone are expected to be $23 million. Orex expects to recover 190,000 oz (5,910 kg) of the yellow metal from the sample, and mining costs are estimated to be about $40 per tonne. Should it be justified, an open pit would cut mining costs to $20 per tonne.

In April, the company agreed to purchase the remaining 50% interest in the property from Onitap Resources (TSE) over the next few years at $8 million.

Orex has since completed a $6-million public offering via McNeil, Mantha of Montreal, to finance the underground work which is expected to take three years to complete.

Mineralization will be drawn from 10 draw points planned for the 250-ft level of the mine and hauled up a 15% ramp to surface in 15-tonne trucks. The ramp and crosscuts are in place. Mining will be carried out by contract miners.

Local residents have responded positively to the plans, Hatchette says. Only one resident disapproved of the plans for an open pit. He is from Ontario and has lived in the area for one year.

The intention is to mill the mineralization at a rate of 1,000 tonnes per day in a mill yet to be designed. Ontario-based Lakefield Research is conducting tests on drill core from the zone in order to find a preliminary milling method and a fast, inexpensive assaying technique. “We expect to have a method within 3-4 weeks,” Hatchette says.

Conventional fire assaying, which typically tests 30 g from a 10-kg sample, is useless for determining gold grades in Meguma- type ores because of the coarse, nuggety nature of the gold which can be easily missed by even HQ- size drill holes. Orex has conducted total extraction assays on whole core samples that were previously assayed by the fire assay method and have come up with significantly higher grades. But the total extraction method of assaying is too slow and considerably more expensive. If Lakefield can come up with a new assaying technique applicable to the unique nature of the gold mineralization at Goldboro, it could also have significant implications for other gold projects in Nova Scotia.

The Orex mill will likely include both gravity and cyanide leaching circuits to recover the gold. Gold occurs in association with and, in some cases, within arsenopyrite crystals at Goldboro.

“In areas where there is a high degree of hydrothermal alteration, there are more minerals and a greater concentration of gold,” Hatchette says. Arsenophyrite, as observed by The Northern Miner during an underground tour of the mineralized areas, can range locally from 1% to 15%. All sightings of visible gold had been removed from the exposed faces.

An environmental study, required for Nova Scotia government approval, will be completed shortly.

The estimated cost of the mill and associated tailings facilities is $10 million. This will be likely financed by a loan from an off- shore bank.

Overburden, consisting of glacial till, in the area of the planned pit ranges from 5 m to 12 m. Engineering is being conducted by St. Michael, a consulting firm.

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