Rambler Metals and Mining is busily looking for new ways to feed its Nugget Pond gold mill on the Baie Verte Peninsula.
To do it, Rambler has signed a deal with a pair of mineral exploration companies, Commander Resources and Maritime Resources, to develop new supplies of gold ore.
The three-company alliance aims to capitalize on record-setting gold prices, a pair of gold prospects, and spare capacity at Nugget Pond, the mill Rambler bought for $3.5 million in late 2009.
Both gold prospects are in the hands of Vancouver-based Commander and its spinoff company, Maritime Resources.
“The overall goal of this alliance is that Maritime and Commander have great exploration expertise and they’ve been working in the area for quite a long time,” said Peter Mercer, Rambler’s vice-president of corporate development.
Rambler is the owner of the Ming copper mine in central Newfoundland.
“We’re running a mine ourselves, so there’s a lot of operational experience that we can bring to the table.”
One potential source of feed for Nugget Pond is the old Hammerdown gold mine operated for four years by Richmont Mines until it closed in 2004.
At the time, Hammerdown was economical when gold prices were $250 per ounce.
Since then, gold has increased six-fold — raising the possibility that the played-out mine could be feasible once again.
Mercer said Hammerdown contains some gold veins with a grade of less than 10 grams of gold per tonne.
“They weren’t economical at $250 an ounce, but at $1,500
on ounce, it certainly changes things.”
The new partners will assess how much gold remains at the old mine.
“We haven’t really put a timeline on it, but I would expect by this fall we’d pass the first phase in terms of looking at the deposit, compiling all the old data and then make a decision on how to proceed,” said Mercer.
“The overall goal of this alliance is that Maritime and Commander have great exploration expertise and they’ve been working in the area for quite a long time.” - Peter Mercer
Commander’s predecessor company, Major General Resources, discovered the Hammerdown deposit in the late 1980s.
The other potential source of mill feed is the Orion gold deposit, an exploration project near King’s Point in central Newfoundland.
Exploration drilling has been ongoing at Orion since February.
In the meantime, the Nugget Pond mill has been busy processing ore from Crown Pillar, a small gold deposit just 150 metres from the processing facility.
“We mined nearly 10,000 tonnes there,” said Mercer.
“We’re just finishing up mining right now and within the next couple of weeks we’ll be mining another small satellite deposit called the Tilt Cove East mine.”
Mercer expects that nearby satellite mine to start up in the next few weeks.
“We have all of our approvals from the government on that.”
Ming copper mine
The goal is to feed the gold mill until the new copper concentrator is ready for ore from the Ming mine.
Rambler is developing some of the Ming’s mineral zones to stockpile copper ore for the mill.
As part of Rambler’s $25-million Ming mine development, the Nugget Pond mill is also in the midst of an expansion to process base metals, such as copper.
Mercer expects the mill expansion will be completed later this year.
“Our goal is for production in the second half of this year, so sometime in the fall we’ll be in production and commissioning the mill.
“Everything is on track.”
Copper concentrate will be shipped out of the province via Goodyear’s Cove.
The warehouse needed to store the concentrate will be built in a few months.
“We’ll be breaking ground on that probably within the next month,” said Mercer.