Homestake Mining (NYSE) will develop its Ruby Hill property in central Nevada, having set aside US$65 million in funding for the West Archimedes deposit.
A feasibility study has determined a proven reserve of 7.6 million tons grading 0.099 oz. gold per ton (or 755,000 contained oz.), including a high-grade core of 1.9 million tons grading 0.233 oz. per ton.
The property also contains the East Archimedes, Deep East and Achilles, which have the potential to bolster reserves.
“We decided to bring the West Archimedes deposit into production, while we continue to explore a prospective area around Eureka,” explains Jack Thompson, president of Homestake. The company plans to spend US$3 million exploring the property during 1996.
The West Archimedes is oxidized, and open-pit and heap-leaching methods will be employed to extract the yellow metal at a low capital cost. About 3,500 tons will be processed daily at a recovery rate of 87%.
Homestake expects direct cash costs to be US$130 per oz., while the production cost is estimated at US$258 per oz.
Construction and prestripping will begin in the second quarter of 1997, following permit approval and completion of an environmental impact statement. The mine could enter production later that year, and a top capacity of 105,000 oz. per year is expected by 1998.
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