Minable reserves within the upper eight levels of the former Madsen gold mine near Red Lake, Ont., are insufficient to justify a resumption of operations, according to a study undertaken by Madsen Gold (TSE).
The study, based on geological data compiled before the high-grade mine closed in 1976, identified 79 possible lenses hosting a mineral inventory of 664,737 tons grading 0.214 oz. gold per ton.
Financed by a grant from the Northern Ontario Heritage Fund (Norfund), the preliminary feasibility study also identified about 109,000 tons grading 0.23 oz. of minable reserves, says Madsen President James Morlock. But as reserves above level 8 are insufficient to finance the capital cost of a 250-ton-per-day operation, Madsen has embarked on a study of data relating to the geological environment from levels 9-24.
The old Madsen mine still ranks second only to Placer Dome’s (TSE) Campbell operations in terms of gold produced. It yielded 8.5 million tons of grade 0.31 oz. during 1936-76.
As geological information was recorded with almost “military precision,” the amount of available records is almost mind-boggling, Morlock told The Northern Miner recently.
Having retained a group of geologists that includes Ontario Securities Commission consultant John Drury, Madsen has applied for a $25,000 grant from Norfund to finance exploration over the next six months. Drury’s role is to establish criteria for preliminary reserves below level 8. Madsen is also hiring an Elliot Lake, Ont., consultant group to determine what the costs of any future mining operation will be.
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