EXPLORATION ’95 — Improved metals prices help — Activity on

Improved mineral prices sent companies with low-risk, fast-return projects back to work in British Columbia last year, causing a moderate upswing in activity.

The 1994 review of the provincial Ministry of Energy, Mines and Petroleum Resources states that the year saw gold and copper prices improve and propel the Similco, Gibraltar, and Afton/Ajax mines into operation again. Exploration, in terms of expenditures and claims staked, both climbed. “Exploration expenditures are anticipated to be in the $100-million range, a 30% increase over 1993,” says the report. “Activity was generally concentrated on small-to-medium-sized programs, primarily in areas with a good geoscientific database, known resources, and a corresponding high probability for new developments.”

Claim-staking increased by 10%, rising to an estimated total of 29,000 units. According to the ministry report, the province is offering an improved operating environment for mining companies. “The development of a number of copper porphyries is advancing, reaffirming that British Columbia is a good place to locate large copper deposits. The province is well poised to benefit from the increases in copper prices, an excellent geoscientific database, a favorable government attitude to resource development, a stable economy, and a highly-skilled and flexible work-force,” the review claims. It also attributes growth to a number of incentive programs the provincial ministry has launched. (See accompanying story, Page 26.)

However, the ministry’s reports indicates that Eskay Creek was the only mine in British Columbia to be completed last year. Gold is the most important commodity, but it will also be the fourth largest silver producer in the world.

Several new mines are under consideration or construction. Kinross Gold (TSE) began construction of its QR alkalic, porphyry-related gold deposit in the Cariboo region and expects to start production early this year. And mine certificates were issued for Cirque, Mount Milligan and Mount Polley; these three still await production decisions.

Solid mineral production in British Columbia is forecast at $2.56 billion in 1994, a 10% increase over 1993. Coal took the lion’s share, or 36%, with a projected value of about $990 million, while copper represented 31% of the projected total with a value of $792 million.

Gold and silver production declined. Gold production is forecast at 12.8 million grams with a value of about $218 million, down by about 4% over 1993 figures, primarily because of cutbacks in production at Myra Falls, Equity Silver, and Similco Mines. Silver output dropped significantly to 125 million grams, a value of $30 million, because of reduced production at Myra Falls and the closure of Equity Silver.

Zinc and lead production is forecast to be 90 million kg and 45 million kg, respectively, with a combined value of $155 million.

The ministry’s 1994 estimate is that industrial minerals will contribute $50 million and structural materials will add a further $325 million to the economy. Last year, there were nine major industrial minerals mines operating, as well as 25 smaller quarries. “New market opportunities are being investigated, and there is increased exploration interest in this sector,” the report says.

Other highlights of the report include updates on mining sector development. * Coal: The mines ministry is expecting that coal production will bounce back to pre-1992 levels with the surge fuelled by Fording Coal’s planned increased production at both the Greenhills and Fording River mines. Manalta Coal continued advanced exploration drilling at its Telkwa thermal coal project and in northeastern British Columbia, and Globaltex Industries (VSE) moved ahead with exploration of the Willow Creek thermal coal project. But, on Vancouver Island, Quinsam Coal ceased open-pit mining and is now producing underground.

* Gold: Snip still leads the pack; underground drilling in 1994 added tonnage to the mine, and production in 1993 totalled 4.65 million grams, making it by far the largest gold producer in British Columbia. The reactivated Myra Falls mine has focused development on the zinc-gold-silver-rich Battle/Gap zone, with ore being blended with the copper-rich HW zone material. Production from this zone is scheduled for mid-to-late 1995.

The last ore was milled in September at the Golden Bear mine site, but potential heap-leaching of low-grade material is under consideration; production is slated for 1995 in the Kodiak A zone, and two new zones of potentially heap-leachable gold mineralization were discovered on the Kodiak North (Ursa deposit) zone.

* Copper: Princeton Mining (TSE) was restructured and the Similco copper mine re-opened in August. Definition drilling occurred in 1994, new reserves have been calculated, and a mining decision is to be announced in 1995. A 2-phase diamond drilling program at the Alabama zone was carried out, as well, to define a reserve base for a final pit design.

Goldnev Resources (VSE) and Bethlehem Resources (TSE) have been encouraged by the results of an 11-hole definition drilling program carried out at the Goldstream copper-zinc mine on the down-plunge of the western extension of the deposit. After a 3-year shutdown, Afton resumed production at the Ajax Mine.

A roundup of exploration and development news issued by the mines ministry for 1994 focused on 11 major sites:

* Eskay Creek: Preproduction work started in October and underground activity in November, 1994. The first concentrates were shipped early this year. * Metall Mining (TSE) reported the discovery of the Cardiac Creek zone, in the Gataga district, near the Cirque deposit. At the zone, massive zinc-lead sulphides were intersected in 12 drill holes along a strike length in excess of l.4 km.

* Red Mountain: Lac Minerals, since acquired by Barrick Gold (TSE), spent $15 million on surface drilling, underground drilling, and development. * Tulsequah Chief: Redfern Resources (TSE) completed underground and surface drilling on site with in-fill drilling intersecting a thick and high-grade zone.

* Huckleberry: New Canamin Resources (VSE) completed nearly 20,000 metres of drilling. As a result of a positive prefeasibility study, New Canamin submitted a pre-application for a mine development certificate. * Fish Lake Copper: Taseko Mines (VSE) continued pre-feasibility studies and plans to submit an application for mine development.

* Kemess South Project: El Condor Resources (VSE) and St. Philips Resources (VSE) applied in December, 1993, for a mine development certificate. Pegasus Gold (TSE) decided not to proceed with the acquisition of El Condor’s outstanding shares, although the results of its due-diligence program compared favorably with the prefeasibility model completed by Kilborn Engineering in July, 1993.

* Mount Polley: Gibraltar Mines (TSE) undertook an extensive due-diligence study to confirm tonnage, grade and metallurgy on Imperial Metal’s (TSE) Mount Polley copper deposit located near the Gibraltar mine. Imperial is continuing its efforts to develop the site.

* Polaris-Taku: Surface work by Canarc Resource (VSE)

has identified a 1,525-metre, northerly strike extension of the property’s three main vein systems. The discovery is more than 520 metres higher than the zone of existing gold reserves and past production.

* Porcher Island: Westmin Resources (TSE) is conducting a mine evaluation and feasibility study examining the possibility of crushing the ore on site and shipping it by barge to Premier’s mill, situated 240 km north. * Red Chris: American Bullion Minerals (VSE) completed 21,400 meters of drilling in 1994, with the work in the east and main zones targeted at expanding a higher-grade core within the deposit.

— The author is a freelance writer based in Vancouver, B.C.