Windarra says La Ronge gold mine could cost $39 million

A recently completed feasibility study on the Contact Lake gold deposit near La Ronge, Sask., estimates capital costs to build a 700-tonne-per-day mine at $39 million, says 20% owner Windarra Minerals (TSE). Windarra holds a 20% stake in the project with the remaining interests held 50% by Cameco (operator) and 30% by Uranerz Exploration, a unit of West Germany’s Uranerzbergbau.

Vancouver-based Windarra recently received results from the feasibility study at Contact Lake which forms part of the Preview Lake project, 56 km north of La Ronge.

The property lies within Lac La Ronge provincial park where environmental concerns could present a challenge for the proposed mining project. Extensive environmental baseline studies have been ongoing and an environmental impact study is currently under preparation.

After drilling 18,057 metres in the Bakos zone of the deposit, minable reserves have been estimated at 1,322,408 tonnes grading 8.38 grams gold per tonne (0.24 oz./ton), representing about 338,314 oz. The above estimate allows for dilution of 14.7% in shrinkage stopes and 23.2% in blast hole stopes.

Under the feasibility plan, mining would be mainly by blast hole stoping with minor shrinkage methods used in the narrower zones. The ore zone would be reached by an underground decline with ore hoisted through a production raise. The mine, which would be built using new equipment, would have operating costs of around $63.91 per tonne, or $249.82 per oz. (US$214.85 per oz.), says Windarra.

The study envisages a 700- tonne-per-day cyanide leach plant with carbon-in-pulp recovery for the ore which is essentially free milling and expected to yield high recoveries in excess of 95%.

While awaiting the necessary environmental approvals, the joint venture expects to continue exploration with the aim of adding to minable reserves. The deposit is open both along strike and to depth. Current reserves have been drilled only to a maximum depth of 250 metres, and along a strike length of one kilometre.

Last month, Cameco poured the first gold bar at its 80% owned Jasper gold mine, which is expected to produce about 85,000 oz. of gold in its first year of production. The Jasper mine is about 140 km north of La Ronge.