Cheni Gold near full capacity at Toodoggone mine

Paul Girard, president, said the company did have some weather- related difficulties during the last two months that affected the start- up phase, but he credited the hard work of employees for achieving what he called “a remarkable job.”

Cheni poured its first dore bar Jan 8 and has since processed 11,220 tons of ore averaging 0.327 oz gold and 5.58 oz silver through its mill to the end of February. Metal production to date is reported at over 3,200 oz of gold and 42,000 oz of silver.

At full production the road- accessed mine is expected to produce an average of 40,000 oz of gold and one million ounces of silver on an annual basis for at least the next seven years. Ore reserves in all categories are estimated at 1,938,000 tons grading 0.198 oz gold and 7.09 oz silver per ton, of which 1,413,222 tons grading 0.207 oz gold and 7.29 oz silver are classed as proven and probable.

According to Girard, the mill ran at an average of 380 tons per day during the last 21 days of February. “We are now very near full capacity,” he told The Northern Miner.

On-site milling is a conventional cyanide Merrill-Crowe circuit followed by conditioning of tails, flotation and cyanidation of bulk concentrate to obtain 95% recovery of gold and 75% recovery of silver.

“So far, the recovery of our gold and silver are within our expectations. We are not yet at our target, but we are very close,” Girard said, adding that the company has received indications silver recoveries will be higher than originally anticipated.

Mill feed is being extracted from underground workings on the AGB zone where a total of 75% of the final development work has been completed. The company said about 50,000 tons of broken ore averaging 0.296 oz gold and 7.79 oz silver have been stockpiled underground and on surface. The AGB zone varies in thickness from a maximum of 65.6 ft where sub-level blast hol e stoping is used, to a minimum width of 4.9 ft where shrinkage mining techniques are employed. The zone is accessed by flat adit entry on four levels

Cheni recently completed a diamond drilling program designed to test the depth extension of the AGB zone below the 1,700- working level. According to Girard, an additional mineable reserve of 33,583 tons grading 0.237 oz gold and 9.60 oz silver was found which is readily accessible from development workings.

In addition, two holes drilled from the north end of the workings are reported to have yielded 0.660 oz gold, 13.54 oz silver and 0.664 oz gold and 56.76 oz silver across a true width of 4.9 ft. The company plans to explore this discovery by additional drilling.

Cheni is also planning pre-production mine development of the Cliff Creek zone in the coming year, to be followed eventually by underground development on the smaller Duke’s Ridge zone.

At last report, capital costs for the mine and mill were estimated at about $43.2 million, although Girard said the final tally would likely be somewhat higher. The company was loaned half the $6.5 million required to build the 64.3- mile mine access road by the British Columbia government.

Cheni is owned approximately 61.5% by Cheni Canada which in turn is an indirect subsidiary of a public company created by government of France.

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