Positive feasibility in hand for Mineral Ridge project

With a positive feasibility study in hand, management of Cornucopia Resources (TSE) is aiming to bring its Mineral Ridge gold project into production by the first quarter of 1997.

The project is situated near Silver Peak, Nev. A plan of operations has already been submitted to the Bureau of Land Management, as a first step in receiving permits for the project.

Mineral Ridge hosts proven and probable minable reserves of 5.2 million tons at an average grade of 0.068 oz. gold per ton, contained within several deposits.

Cornucopia intends to mine the deposits by open-pit methods, with an overall stripping ratio of 4.3 tons waste to each ton of ore. The ore will be crushed to 100% minus-8 mesh, in a 4-stage crushing circuit. It will then be agglomerated and stacked on a permanent pad, where gold will be recovered by standard heap-leaching methods.

Gold recovery, based on extensive metallurgical test work, is estimated to be 80.8% on a life-of-mine basis.

Once the mine is up and running, it is expected to produce between 45,000 and 56,000 oz. gold per year. Cash operating costs (before taxes, royalties and refining costs) are estimated at US$222 per oz. over the mine life.

Processing facilities are being designed for a production rate of 2,700 tons per day, 365 days per year. At this rate of production, existing reserves would be sufficient for about 5.5 years. However, Cornucopia believes ongoing exploration and drilling will expand and extend the life of the mine.

Cornucopia notes that the operation will generate an estimated internal rate of return of 18.9%, based on a gold price of US$385 per oz.

The initial capital cost will be $16.4 million, which includes pre-production operating expenses (pre-stripping, road-building, etc.), process facilities and support facilities.