Study calls for Briggs development

With positive results in hand from an independent feasibility study, Canyon Resources (NASDAQ) says mine development could begin this fall at the Briggs gold project in southeastern California.

Construction of the heap-leach mine is expected to cost US$18.3 million, plus an additional US$8.4 million for preproduction stripping and working capital.

Minable reserves include 636,000 oz. gold contained in 21.5 million tons, averaging 0.030 oz. per ton. Annual production over 6.5 years is projected to be 75,000 oz. Ore will be mined at an average stripping ratio of 1.24-to-1 and crushed to minus 1/4-inch.

The study projects cash operating costs to be US$233 per oz. of recovered gold (including royalty and reclamation).

The project sits on federal claims and may therefore be subject to an additional royalty, depending on whether expected changes are made to the Mining Law.

Canyon also has a 27.75% interest in the McDonald gold project, a joint venture with 72.25%-owner Phelps Dodge. The deposit contains 414 million tons grading 0.020 oz. A feasibility study has determined the mine could produce 308,000 oz. annually, with reserves expected to last 12 years. Phelps Dodge plans to restructure its interest in the McDonald gold project, and Canyon has responded by entering discussions with a major company to form a partnership and jointly attempt to buy the Phelps Dodge interest. Canyon produces gold and silver from a mine in Montana and has interests in industrial minerals. It reported a loss of US$237,200 for the first quarter, compared with earnings of $49,800 for the same period in 1993.