U.S. projects boost reserve estimates

A number of new mines opened in the southwestern U.S. during the past year. At the same time, a few exploration bets proved up to be substantial mineral deposits. For example, Crown Butte Resources (TSE) reported a large jump in preliminary reserves based on its 1990 drilling program at the New World property in Park Cty., Mont.

Prior to the 1990 program, reserves were estimated at 4.64 million tons grading 0.81% copper, 0.17 oz. gold and 0.72 oz. silver per ton. With this year’s drill program still in progress, preliminary reserves now total about eight million tons averaging 0.2 oz. gold, 0.7 oz. silver and 0.7% copper.

With mineralization substantially open, the company plans to drill through the winter in an attempt to further determine the deposit’s size. Noranda (TSE) has the right to acquire Crown Butte shares up to 60%.

The past year has been very good to Crown Resources (VSE). The Kettle River underground gold mine in which the company has a 30% interest was brought into production by partner Echo Bay Mines (TSE) without a hitch.

At the company’s Crown Jewel gold property, also in northeastern Washington State, 1989 drilling results attracted Battle Mountain Gold (NYSE), which entered into an agreement to earn 51% of the property by paying US$10 million in cash and funding the project to production.

Subsequent drilling results have been firming up preliminary reserve estimates of over eight million tons grading 0.10 oz. gold per ton.

A number of new mines were opened in the western U.S. over the year.

Kennecott Corp., along with partners Kiewit Mining, and Plexus Resources (TSE), opened the Denton Rawhide heap leach gold mine in Nevada.

Santa Fe Minerals, a unit of Santa Fe Pacific (NYSE), opened the company’s Rabbit Creek open pit gold mine and is already gearing to double production to 200,000 oz. of gold per year.

Galactic Resources (TSE) and Cornucopia Resources (TSE) recently brought the Ivanhoe heap leach gold mine in Nevada into production.

The Elder Creek heap leach gold mine in Nevada was opened by Alta Gold (NASDAQ) and Nerco (NYSE).

Tenneco (NYSE) opened its Fondaway gold mine near Fallon, Nev. It is projected to produce about 12,000 oz. per year.

Breaking the trend of new heap leach mines, Malartic Hygrade Gold Mines (VSE) opened its Congress underground gold mine in Arizona.

Major gold producer Pegasus Gold (TSE) added another mine to its growing roster when, along with partner USMX (NASDAQ), the first gold was poured at the relatively small Casino mine in Nevada.

In Washington State, RFC Resource Finance (TSE) is attempting to find financing for its Pend Oreille zinc-lead project.

Another Washington State property which is experiencing some activity is the Van Stone zinc-lead mine. Owner Equinox Resources (TSE) recently arranged production financing to reopen the former producer which comes complete with a 1,100-ton-per-day mill.

Viceroy Resources (TSE) is likely to be added to the list of producers now that it has received the long-awaited approval to begin development of the Castle Mountain gold project in California.

Development of the Oracle Ridge underground copper mine in Arizona is reported by owner South Atlantic Ventures (VSE) to be substantially complete with mill startup expected shortly.