Barrick unveils $365-million Nevada mine plan

Over the next four years the company will spend $365 million(US) to harvest the vast ore reserves contained in the surface Post and Betze deposits at the Goldstrike mine near Elko, Nev.

Using open pit mining methods, Barrick plans to increase its Goldstrike gold output from 115,000 oz in 1988 to 900,000 oz by 1992 and become one of the largest gold mining companies with operations based solely in the United States and Canada.

As a result, Barrick’s total gold production is expected to rise from 335,000 oz in 1988 to well over one million ounces by the early 1990s.

The development program is also expected to make Goldstrike, which until recently was a modest 40,000- oz-per-year heap leach operation into one of the biggest gold mines in North America. It will be by far the largest of Barrick’s seven gold mines.

Situated on the burgeoning Carlin gold trend next to a number of gold mines operated by Newmont Mining subsidiary Newmont Gold, the Goldstrike was acquired by Barrick in late 1986 when oxide reserves stood at about 500,000 oz grading about 0.04 oz gold per ton. Surface post

After an aggressive deep drilling program, Barrick has managed to increase its Goldstrike reserve inventory in all categories to 128.4 million oz grading 0.095 oz gold per ton or 12 million oz.

All of those reserves are contained in the surface Post and Betze deposits which host 64.4 million tons of sulphide ore grading 0.164 oz gold. Not included in Barrick’s development plans is an additional four million tons of sulphide ore grading 0.34 oz which lies in the Deep Post deposit about 500 ft below the oxide ore which has sustained the mine since it went into production in 1979.

All reserves lie in an area spanning about 4,000×1,600 ft deep but the fact that the Deep Post deposit encroaches onto Newmont Gold’s adjacent Post claims means that it won’t be mined probably until the mid 1990s.

To finance the gargantuan program, Barrick recently announced a 1,050,000 oz gold loan facility underwritten by the Union Bank of Switzerland, Westpac Banking Corp. and The Royal Bank of Canada.

“Combined with existing cash flow, the gold loan will be more than enough to finance the development program,” said President Robert Smith. Corporate plans

Barrick has already pre-sold 750,000 oz at $418(US) per oz to finance the program and will draw down 250,000 oz in the second quarter of 1989 for what Smith called additional corporate purposes.

“Over the life of the Goldstrike development plan, cost per ounce will be about $190(US) to 195 per oz making the mine one of North America’s lowest cost gold producers,” said Smith.

Using 40 cu-yard shovels, capable of moving ore and waste material at a rate of 90 tons per lift, Barrick will excavate to a depth of 1,500 ft a mammoth open pit measuring 7,000 ft long and 4,000 ft wide.

Most of the ground will be moved by 190-ton electric trucks. At least 27 trucks will be on site by the end of 1989 and another 13 will be brought on stream before the operation reaches full capacity.

At that point the mining rate will have increased from 38 million to 100 million tons annually and the milling rate from 6,000 tons to 12,750 tons per day. Since all Goldstrike production is currently taken from near-surface oxide reserves, the company is using a mixture of carbon-in-leach technology and heap leaching to recover gold. Production from 1991 onwards, however, will come mainly from the Betze sulphide ore. Oxide mill

For that reason, the 4,500-ton- per-day oxide mill will be converted in two stages starting this year to treat an additional 1,500 tons of sulphide ore daily and then 6,000 tons per day in 1991.

By the end of 1992, the entire milling complex will be expanded to treat 12,750 tons of sulphide ore daily and any remaining oxide ore after 1991 will be processed through heap leaching.

Although water is expected to flow into the pit at a rate of 85,000 gallons per-minute, that is “peanuts” when compared to other mining operations, according to Smith. “We will have no problem at all in maintaining a de-watered mine,” he said.

Facilities are being installed to collect, pump and store inflows of water that are expected to increase from 1,000 to about 85,000 gallons per minute by the year 2,000. Barrick and Newmont have signed agreements with local cattle ranchers who will use the water for irrigation and to feed livestock.

“Everything about this deposit is large scale,” said Smith who admits to being astonished by the size of the Goldstrike orebody.

For example the grade/thickness of the high grade ore in some areas of the Betze and Deep Post measures 300 ft. Even though exploration at Goldstrike during 1988 was sacrificed in favor of development, Smith said he fully expects to find additional reserves on Barrick ground. Mining waste

According to Smith all the permits are in place and a lay back agreement with neighbor Newmont Gold will allow Barrick to mine oxide ore in an area bordering on the U.S. company’s Post claims.

Under the agreement, Barrick will be reimbursed for the cost of mining waste ore on Newmont’s side of the boundary.

Barrick’s short term plan is to mine the surface Post oxide pit and to push back westward toward the upper sections of high grade sulphides in the Betze pit. The over- all strip ratio is 6.4 tons of waste per ton of ore and recoveries are expected to be about 87%, according to Alan Hill senior vice-president of operations.

The company has opted to go that route because the Betze’s high grade sulphides are much shallower than the Deep Post and the pre- strip of deep Betze produces an additional million oz of oxide ore which could pay for work. “In order to achieve our objectives, we have adopted a plan which calls for the pit to be mined out over a 12-year period from 1989 to 2,000,” said Hill.

But the Deep Post reserves are expected to sustain operations well past 2006.

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