Pegasus set to open sixth U.S. mine

The Black Pine property in Idaho is slated to become the sixth mine for Pegasus Gold (TSE), a Spokane-based producer which currently turns out over 340,000 oz. gold from five operating mines in the western U.S. Located in Cassia Cty., Black Pine is expected to produce an average of 60,000 oz. gold annually over the current 5-year life of the open pit, heap leach mine. The company said the production rate would vary between 40,000 and 80,000 oz. in any given year.

The project has proven minable reserves of 7.7 million tons of oxide ore grading 0.042 oz. gold per ton with a projected recovery rate of 75%. It also has 8.1 million tons of low-grade reserves grading 0.014 oz. gold with a projected 50% recovery rate.

A feasibility study for the project was recently reviewed by the consulting firm of Pincock, Allen and Holt. Initial capital cost for the project is estimated at US$11.8 million, and operating costs are projected to be an average of US$4.88 per ton.

“We are pleased to be able to add another mine to the five currently operating,” said Michael Clark, chief operating officer for Pegasus. “Since the project is already fully permitted, we expect gold production to be slightly in excess of 20,000 oz. during the second half of 1991.”