RFC gaining confidence on Pend Oreille project

Underground drilling is meeting with success at the Pend Oreille zinc project, where a distinct zonal mineralizing trend has been identified, RFC Resource Finance (TSE) says. The project is in Washington, about 55 miles south of Cominco’s smelter in Trail, B.C.

The recognition of predictable metal distribution patterns in the deposit bodes well for future mining, Douglas Nicholson, president of RFC told The Northern Miner. “The previous miners had difficulty following the ore trend. However, we always felt there was a definite zonal configuration.”

The company is drilling in detail the southern lenses in the Yellowhead formation, a unit which underlies the previously mined Josephine formation. The Mississippi-Valley type zinc-lead deposits at Pend Oreille are similar to those which were mined in the Pine Point camp in the Northwest Territories.

Drilling in the South lens has defined the mineralizing trend within the formation. Holes from the richest sections include 37.4 ft. grading 12.8% zinc and 7.0% lead, 17.8 ft. grading 7.1% zinc and 0.9% lead and 19.3 ft. assaying 9.6% zinc and 3.1% lead. Another hole intersected 23.3 ft. grading 8.9% zinc and 1.8% lead.

The underground drill effort has also improved undiluted zinc grades within the area by more than 13%. Before the program began, the South lens was believed to host reserves averaging 7% zinc. The current program has enabled RFC to define one million tons of reserves grading 9.2% zinc and 3.4% lead in a flat-lying 14-ft. thick zone. Using a 15% dilution factor, reserves increase to 1.18 million tons grading 8% zinc and 3% lead in a 16.1-ft. wide zone.

“We expect some faulting by northeast faults, however within the lens, our information suggests good, regular continuity,” Glenn Hogg, a consulting geologist working for RFC, explained. In fact, Hogg says that RFC’s definition drill program suggests that the zone “does not have the grade or structural complexity that the original operations might have suggested.”

Based on surface drilling and compilation of data from previous mine operations, RFC estimated total reserves of three million tons grading 9.8% zinc and 1.9% lead in lenses north of the mine workings. With the success in the South lens, previously given a low development priority by RFC, the company feels that reserves well in excess of the three-million-ton figure can be defined.

A 55,000-ft. drill program followed by a new mineable reserve estimate and a feasibility study, are expected to be completed by the end of March. Pending the receipt of a positive study, RFC will require approximately $30 million to reopen the facility, Nicholson says.

The mine, which operated from the early 1990s until closing in 1977, has a 2,400-ton-per-day mill on site and a variety of surface installations. Henry Gingrich, the former senior executive of Cominco responsible for the construction of that company’s massive Red Dog zinc mine in Alaska, is overseeing the rehabilitation of the surface facilities. According to Nicholson, the first appraisal of the mill and site equipment completed by Gingrich, concluded that the ball mills and crusher are in good shape after 12 years of inactivity.

Although the $30-million capital requirement for reopening the mine might appear steep for a junior company, RFC has senior corporate sponsorship. Kerr Addison Mines (TSE), has a 44% interest in the company and has supported Nicholson from day one. Kerr is expected to maintain its equity stake when RFC seeks project financing later this year.