Teck deals Leitch mine to San Paulo Explor.

A junior mining company that until now has been playing a rather low-key role, San Paulo Explorations is teaming up with Teck Corp. for a new look at the renowned old Leitch mine in the now-bustling Beardmore area of northwestern Ontario.

A former and highly profitable producer that operated continuously for over 30 years, it was probably this country’s highest grade gold mine — a textbook mine if ever there was one. And when it closed in 1964, it was not without ore as would be classified today. That was when gold was still $35 an ounce.

Under the terms of an agreement signed this week, San Paulo must spend a minimum of $3 million ($1 million firm) over the next 36 months to earn a 50% interest in the Leitch property. Teck, which acquired it through an amalgamation in ’68, will be the operator.

Actually, San Paulo has been eyeing the Beardmore area for some time, having acquired some 475 claims in five separate groups, two of which tie right on to the north and south of the patented Leitch ground. But it was mining maverick J. P “Pat” Sheridan, a director of San Paulo, who was the big pusher for the Leitch ground itself.

“I have always liked that Leitch,” he says, emphasizing that it was the prevailing conditions of the time that closed it — the gold was still there. He thinks there could be as much as a million tons of broken muck in the stopes that would probably be commercial today, pointing out that the reusing stoping method used to extract the rich but narrow vein (vein material and walls blasted separately) would likely leave some of the gold in the blasted rock fill.

Even the surface dump could likely be economically milled today. In fact several years ago Teck trucked a sizeable tonnage from this all the way to its Lamaque mill in Quebec and made a profit. It averaged around 0.20 oz.

However this Leitch rock dump is not included in the San Paulo deal. This is currently under option to A. C. A. Howe’s Ateba Mines as is the nearby Sturgeon River mine dump. (It is the Howe interests that have acquired and operate a relatively new 200 ton gold mill in this Beardmore area).

The tailings dump, too, is under option to a Quebec company on a 50-50 profit sharing basis with Teck. However Teck will turn over half of anything it receives from this source to San Paulo. Plan much drilling

For starters, an intensive program of exploratory surface drilling will be initiated on both the patented Leitch ground and the adjoining claims.

“I am a believer in saturation programs,” John L. May, president of Teck Exploration told The Northern Miner. “But we will also be looking at pumping out the mine. For there were ore indications on the bottom level that were not followed up. I certainly think there is potential there,” he added.

San Paulo President Peter D. Walker expresses complete confidence in the company’s ability to finance the project. The company is already in a fairly healthy financial position, with some $700,000 cash on hand and owning a 10% share interest in Sheridan’s Anyox Metals, as well as a sizeable holding in Madeleine Mines acquired on the open market at prices well below that company’s current $14 price level.

There are currently about 4.3 milliion shares issued and listed on the Alberta Stock Excange. The company would like to see these listed both in Toronto and on the U.S. nasdaq system as well.