Cornucopia suspends mining at Mineral Ridge

Gold mining at Mineral Ridge in Nevada, which got under way less than a year ago, has been temporarily halted by owner Cornucopia Resources (CNP-T).

Cornucopia says it is closing the mine for three months “in order to reduce operating expenses and maximize cash flow in this time of a depressed gold price.”

Leaching operations and gold production will continue during the shutown period, using stockpiled ore.

Mineral Ridge was completed in late May, ending 10 months of construction.

Since gold was first poured in late June, production has totalled 10,400 oz., revealing a leach rate that has been slower than anticipated.

Preliminary tests indicate that the leaching difficulties may be a consequence of contaminants in the process water supply.

The company expects to make use of the downtime by completing further tests and attempting to improve its process water chemistry so that the leach rate can be increased.

Cornucopia estimates that between the leach pad and the run-of-mine stockpile, the Mineral Ridge site contains an inventory of 20,500 oz. gold.

Continued production from this ore will be sold at hedged prices of US$363 per oz. gold in November, US$394 in December, and approximately US$382 in January and February. This hedging strategy is designed to help Cornucopia maintain its liquidity until the leaching problems are worked out, or until the gold price rebounds.

Cash costs at Mineral Ridge are projected to be in the range of US$235 per oz. gold.

Annual production from the open-pit, heap-leach operation is projected at 50,000 oz. over the estimated 5.5-year mine life. Reserves were last reported as being 5.2 million tons grading 0.068 oz. per ton.