Pair of gold mines for Baie Verte Peninsula

Moira Baird
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St. John's-based Tenacity Gold Mining Co. wants to start up a pair of small gold mines on Baie Verte Peninsula this summer.

The company expects to truck ore from both mines to the nearby Nugget Pond mill at Snook's Arm starting as early as June, if it gets approvals and permits from the province.

The entrance to the Deer Cove adit, which is a horizontal passage into a mine, on the Baie Verte Peninsula in June 2009. - Submitted photo

St. John's-based Tenacity Gold Mining Co. wants to start up a pair of small gold mines on Baie Verte Peninsula this summer.

The company expects to truck ore from both mines to the nearby Nugget Pond mill at Snook's Arm starting as early as June, if it gets approvals and permits from the province.

Both mines - one dubbed Stog'er Tight, the other Deer Cove - will be played out in about five months.

"If we get these up and going, they'll probably be amongst the smallest gold mines Newfoundland has ever seen," said Charles Dearin, president of Tenacity Gold Mining.

Both proposed mines are in the midst of an environmental assessment by the provincial government.

Public comments are due by April 15.

The environment minister's decision on the Deer Cove mine is due April 23, while a decision on Stog'er Tight is due April 24.

Dearin is proposing an open-pit mine at Stog'er Tight, and estimates the cost of producing the gold at $60-$70 per tonne. For Deer Cove gold, the cost is estimated at $125-$150 per tonne.

Dearin also figures the project will employ a combined 45-50 people at the mines and the mill.

Both properties were previously explored by one-time mining giant Noranda Inc. in the late 1980s and early 1990s. It initially pegged the gold reserves at Stog'er Tight at 600,000 tonnes.

Ming Minerals acquired the property in 1996, carried out more exploration drilling and slashed those reserve estimates to less than 200,000 tonnes of gold.

In the meantime, gold prices also dropped and Ming eventually lost the rights to the property several years ago for failing to pay land lease fees.

Dearin landed exploration rights in 2007 and set out to assess reserves.

"I spent two summers re-sampling the pit ... and did some very detailed geological mapping."

Dearin estimates about 93,000 tonnes of moderate-grade gold at Stog'er Tight, along with 8,700 tonnes of low-grade gold dug up and stockpiled by Noranda.

"It is economical," Dearin said. "We're very, very confident that this can be mined."

Contributing to the economics are gold prices above US$1,100 per ounce and an opportunity to mill the ore at Nugget Pond thanks to an agreement with mill owner Rambler Metals and Mining.

"The price is good. It's going to be a lot better next year, I think.

"The big opportunity we have right now is ... we just signed a deal about two weeks ago with Rambler. We'll supply the mill feed and they'll mill it and recover the gold for us."

At Deer Cove, Dearin estimates reserves of 7,600 tonnes of moderate-grade gold in a narrow, underground vein, along with 4,275 tonnes of low-grade gold stockpiled on the property by Noranda.

It discovered a narrow vein at Deer Cove in 1986, and dug an underground tunnel to get a better look at it. In the end, only 30 metres of the more than 200-metre vein was of significant grade and Noranda abandoned the property.

"Fortunately for us, those stockpiles are still there today," Dearin said.

"This will give us mill feed for the first three or four weeks of the mill starting up, and by that time we'll have Stog'er Tight in production."

mbaird@thetelegram.com

Organizations: Noranda Inc.

Geographic location: Deer Cove, Baie Verte Peninsula, St. John's Newfoundland

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Recent comments

  • Brad
    July 02, 2010 - 13:35

    House, nobody will clean it up, thats the way things are done in Newfoundland. Let the companies rape the land, run away with their profits, and we'll bury the mess and deny it was ever there in the first place. They'll do a thousand years worth of environmental damage for a few months work, how pathetic.

  • Jeff
    July 02, 2010 - 13:29

    I think instead of 200,000 tonnes of gold.. and other references to the amount of gold in tonnes, should be ounces instead of tonnes. If a deposit held 200,000 tonnes of gold Noranda or Rambler would never have released it. Might be trying to say that the 200,000 tonnes should be ORE and not actual gold alone. 1 tonne is 35,275 ounces, and at $1000 an ounce, thats $35,275,000. So at only $70 to produce 1 tonne , a company would be INSANE to let that go.

  • House
    July 02, 2010 - 13:24

    And who is going to clean up the site when they move out. The taxpayers?

  • Brad
    July 01, 2010 - 20:25

    House, nobody will clean it up, thats the way things are done in Newfoundland. Let the companies rape the land, run away with their profits, and we'll bury the mess and deny it was ever there in the first place. They'll do a thousand years worth of environmental damage for a few months work, how pathetic.

  • Jeff
    July 01, 2010 - 20:16

    I think instead of 200,000 tonnes of gold.. and other references to the amount of gold in tonnes, should be ounces instead of tonnes. If a deposit held 200,000 tonnes of gold Noranda or Rambler would never have released it. Might be trying to say that the 200,000 tonnes should be ORE and not actual gold alone. 1 tonne is 35,275 ounces, and at $1000 an ounce, thats $35,275,000. So at only $70 to produce 1 tonne , a company would be INSANE to let that go.

  • House
    July 01, 2010 - 20:09

    And who is going to clean up the site when they move out. The taxpayers?