Teck Corp. Off and Running

The euphoria, though less feverish than in the early 1980s, is still with us. You can feel it in the office towers on Bay Street and you can almost taste it in the booming towns of northwestern Ontario. Little wonder. Within only the past six years, the Hemlo discovery has almost single-handedly revitalized Canada’s gold mining industry. A good example of the speed with which the discovery has been developed is the David Bell mine, owned 50-50 by Teck Corp. and International Corona Resources. The mine has come a long way in a remarkably short period of time. The story of Hemlo is, by now, a Canadian legend — one in which Teck has played a major role. The Teck- Corona ground had been explored previous ly with known gold discoveries going back to the 1920s. Teck had drilled there in the 1950s and found 89,000 tons grading 0.24 oz gold per ton. With gold at $35 per oz in the 50s, Teck’s geologists weren’t interested in ore grades of less than 0.25. But with gold prices hovering around $400 per oz in the early 1980s, the ground caught the eye of two experienced prospectors from Timmins.

Don McKinnon and John Larche staked the Hemlo claims in 1979. In the following year they optioned the property to Corona (Corona Resources at the time), a Vancouver company financed by Nell Dragovan and Murray Pezim. Initial drilling was in an area of previously known mineralization, now known as the West zone, to check earlier results and establish geological control. In 1981 geologist David Bell gradually moved along strike to the east, following the mineralized formation and developing the concept of a major, stratabound orebody, while working on the acquisition of the patented Williams claims to the west so that drilling could proceed along strike in that direction as well.

The actual moment of discovery came when the drill cores from the now-famous seventy-sixth hole were examined. Until then, all drilling had been on the west side of the diabase dike. Hole 76 was on the east side of the dike and the core samples pointed to the existence of a similar gold deposit — only bigger.

Bell’s major contribution was honored when, in 1986, the Teck-Corona mine was renamed the David Bell mine.

Corona’s was the first economic discovery in the area. But subsequent drilling on the Williams property (on strike to the west) and on the Golden Giant property (down dip to the north and west) indicated that all these properties straddle a single, major gold deposit — one of the largest in Canadian history.

Teck and Corona entered into a development contract in December, 1981, under which Teck would earn a 55% interest in the property upon arranging to place it into production. This was later changed to the current 50-50 arrangement between the two companies.

By May, 1985, fewer than four years after the 1981 discovery, the Teck- Corona mill was producing gold. While the mine itself is still in the development stage, it began contributing to Teck’s and Corona’s earnings last October. “Income from the mine is definitely improving as deep-level, underground development continues,” mine manager Ruston (“Rusty”) Ford told The Northern Miner Magazine on a recent visit. And in November the operation reached its rated capacity of 1,000 tonnes (1,100 tons) per day, grading 0.25 oz gold per tonne.” By comparison, the average mill throughput for the previous fiscal year was 556 tonnes per day; and for the quarter ending Dec 31, 1986, the mill throughput averaged 924 tonnes per day.

Actually the 1,000-tonne-per-day capacity was hoped to have been reached somewhat sooner, Ford explained. The reason for the delay is that, at one point, Teck had planned to use Noranda’s shaft, which was sunk on the Corona property. “But they were behind schedule in the shaft-sinking, so we were unable to go about the stoping and other development which we had planned.Nevertheless we have been producing quite satisfactorily for the past 12 months.” Indeed, for fiscal 1986 (Oct 1 to Sept 30) the mine milled 203,000 tonnes of ore grading 0.27 oz gold per tonne, to produce 52,888 oz of gold — all while still under development. (Most of this production came from the upper levels.) Mill recovery was 96%.

According to Corona, by 1989 production should reach 190,000 oz of gold at an average cost of about $100(US) per oz. That’s including production from a quarter claim in which Teck and Corona share a 50% net profits royalty interest. It has been optioned to Hemlo Gold Inc. which has developed a n adjoining property.

The Teck-Corona ore zone extends from near surface to a depth of 3,500 ft at the northern claim boundary, and from the east side of the property to the west boundary for a strike length of more than 3,600 ft. Mineable reserves stand at 6.1 million tonnes grading 0.36 oz gold per tonne (that doesn’t include the West zone, which is not expected to become a source of production in the immediate future). Mineable reserves on the quarter claim are 2.1 million tonnes grading 0.40 oz gold per tonne.

Access to the orebody is gained by a 3,800-ft, 4-compartment shaft sunk by MacIsaac Mining and Tunneling of Sudbury. Level stations are at 330-ft intervals.

Two separate mining methods are used. On the upper three levels (source of most of the production to date) mechanized cut-and-fill has been used. This is the best-suited method for these levels because the orebody here dips at about 50 degrees and is narrow, says chief geologist Paul Bankes. Also, the grade on the upper levels averages 0.26 oz gold per tonne — considerably lower than on the lower levels. Cut-and-fill is very labor- intensive, making it more expensive than bulk methods. Eventually this method will be discontinued, to be replaced by long-hole mining methods with delayed fill on the lower levels. About 60% of the ore (some of it grading as high as one ounce per ton) and about 75% of of gold reserves are located on these lower levels.

Areas mined out adjacent to new mining areas are filled with a hy draulically placed mixture of mill tailings and cement. Diesel-powered loaders are used to take the broken ore from the mining areas to the ore passes. The ore is passed through a grizzly before going to the skips. Beginning in July, the ore will be passed through a series of ore passes to a crushing station near the shaft bottom. The ore will be reduced to six inches in size by a standard 48×36-in jaw crusher and hoisted to surface in 7.7-ton skips.

The greatest advantage of long-hole mining is that it is less labor-intensive than cut-and-fill, says Production Engineer Francis Sheridan. Since it is more mechanized, the method will result in increased tonnage but with the same amount of manpower.” He adds that long-hole is also more specialized. “A cut-and-fill miner has to be a jack-of-all-trades, which involves running a jackleg, a scoop tram, a stoper, etc. But, with the long-hole method, a miner can specialize more. For example, a driller drills every day, and so on. In addition ground support costs are much lower with long- hole mining.”

Much of the underground development program has been financed from limited production on the upper levels. That included shaft completion to a depth of more than 3,800 ft and drifting to the west on the 2,400-ft and 3,400-ft levels toward the main production ore. Grade is highest on the west end of the property. “The strategy has always been that ore could be developed on the first three levels far sooner than it could on the lower levels,” Bankes explains. Therefore ore began to be developed near surface shortly after the shaft passed the third level and while shaft-sinking was ongoing. The upper level stopes were put into production to generate millfeed until the lower-level stopes could be developed. This allowed an earlier cash flow, enabling lower level development to be funded by operations.

“We will be producing from the Lower A zone (the lower levels) starting in July and on for about another 10 years,” Ford said. With known reserves, the mine is expected to be producing into the 21st century.

In recent months about 30% of tonnage has been coming from the development o f the No 7 (2,400-ft) level, which is the main production horizon, Bankes says. That production is expected to increase as stoping on this level gets under way this summer. The No 10 level (the main haulage level) should be completely developed by late summer, shortly after the crusher station is to be installed. Also, rock pass raising is under way and development of the No 8 level recently passed through the diabase dike and will reach the ore zone in early summer.

The construction budget called for an expenditure of $90 million to bring the mine into production. The project was under budget with only $80 million having been spent when gold production began. Capital spending to the end of February was $94 million, of which $84 million was funded from bank loans. The remaining $10 million came from operations.

Nevertheless the mine has experienced a few surprises. Back in 1984 Teck estimated an average operating cost of $120(US) per oz for the first 10 years of production. By comparison, last year’s operating cost was a hefty $280 per oz. Of course the mine was not yet in full production last year, which may explain the large cost discrepancy. Another reason may be that Teck decided in 1985 to employ mechanized cut-and-fill for the upper levels. Corona estimates future costs per oz as being: $186(US) in 1987; $99 in 1988; $95 in 1989; $101 in 1990; and $107 in 1991.

Another problem involved “Last spring our sedimentation pond built up to the point where we didn’t have the capacity to treat a sufficient amount of water, and we cycled it back to the tailings pond,” Ford recalls. “Then the recirculation pipeline backed up, causing some of the untreated waters to overflow into the environment.” However, the mishap hasn’t slowed production, he says. Teck recently modified the mine’s water treatment and recirculation system and it has been smooth sailing ever since.

Last year saw an administrative shake-up. John Anderson was appointed Teck’s general manager for the entire Hemlo area. The previous mine manager, Al Mitchell, left the operation in May and was replaced by Ford, previously the mine superintendent.

Milling at the David Bell mine involves grinding the coarse ore in a 2-stage grinding circuit. The pulp is thickened prior to pre-aeration and cyanide leaching for gold extraction. Gold is recovered by the carbon-in- pulp process, the carbon stripped of its gold content, and the gold recovered by electrowinning followed by smelting and casting into bars. The carbon-in-pulp method was chosen over the Merrill Crowe process mainly because of lower capital cost and lower gold losses.

Tailings are fed to three stages of cycloning to produce backfill for the underground operation. The tailings sands are mixed with minus 1/4 -inch borrow material and cement prior to flowing to underground stopes.

There are 183 employees at the mine, consisting of 50 staff members and 133 hourly paid workers. MacIsaac Mining & Tunneling of Sudbury has more than 100 people working on lower level development. Most Teck- Corona workers live in the Township of Marathon.

Considering the rate at which it has entered production, the David Bell mine is certainly one of Teck’s most exciting projects.” Ford says. “The previous fiscal year has been a continual year of improvement and 86/87 will be even better. We are reaching our full potential very quickly.”