“We expect to come in under budget and start commercial production in early March,” he said. If all goes according to plan, Rawhide should annually produce 81,000 oz of gold and 377,000 oz of silver from an ore reserve of 29.4 million tons grading 0.04 oz gold per ton and 0.368 oz silver.
In terms of annual output, this production rate would position it behind only Round Mountain, owned by Echo Bay Mines (TSE) and Homestake Mining; Mesquite, owned by Gold Fields Mining; and Zortman/Landusky, owned by Pegasus Gold (TSE) and Zortman Mining. (The ranking is based on 1989 projected production figures.
In a brief interview after the meeting, Ditto said he expects production costs should average $175- 250(US) per oz. The annual production rate will be two million tons. The strip ratio is 2.5 to 1.
Plexus owns 24.01% of the project with an additional 2.45% net smelter royalty. Kennecott Corp. is the majority owner.
Plexus is also working on a copper deposit in Oregon called the Bornite project. Reserves have yet to be proven up, but Plexus reports a “geologic reserve” of three million tons grading 2.5% copper, 0.023 oz gold and 0.71 oz silver.
Ditto said the underground deposit, thought to be a circular breccia pipe, requires more infill drilling to determine the dimensions and true (proven and probable) grade and tonnage. The drill program of roughly 10,000 ft will begin early next year. Preliminary metallurgical tests have yielded exceptional recoveries.
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