Tuesday 25th October 2016

Resource Clips

Gold-Ore CEO Glen Dickson on Sweden gold assays of 77.95 g/t over 5.9m

“The Bjorkdal gold mine was discovered in 1985 as a result of geochemical sampling and was put into production in 1988. It ran quite well until the price of gold collapsed in 1998-99. Then it went into receivership. After a year, the plant started operating, processing low-grade stockpile material. As the price of gold went up, this material became valuable. We looked at it in 2005, and it was pretty much a salvage operation at that point. But we felt that the ore body could be extended underground. So we signed an option to purchase the project in 2006. Then we undertook about $6.5 million to $7 million in investment to follow the ore body underground, develop resources and reserves. At the same time, the price of gold kept going up so that we found that we had residual resources and reserves in the open pit. So currently it’s mined from underground and from open pit at the rate of about 3,200 to 3,400 tonnes per day.

“The main lessons of this press release, are the so-called off-section holes which reach out into the hinterland—for lack of a better term—where we had spotty intersections previously. We’re not really deep, but we’re still about 200 to 300 metres below surface. We refer to these holes as off-section because they cut the ore zones at an oblique angle. We discovered that the mineralized system—which is a sheeted vein complex within a granodiorite—continues out well beyond where our resources/reserves are from the underground. What that does is it gives us the added confidence that we have a long mine life there. So, if we want, for example, to start purchasing more of our own equipment and developing that part of our business, we know that there’s going to be a long mine life at the current gold price.

“It’s ongoing drilling in the mine site. We continually develop resource drilling. It’s kind of a mine-a-tonne, find-a-tonne operation. So, we’ll continually drill underground. And there’s an area in the open pit that, historically, was left untouched because there was some waste rock on top of it. We’re currently drilling under that waste rock to see if we can justify removing that limestone cap. Then we’ll process that. So we’re drilling in the pit as well.

“As soon as you get into production you realize that you’re always trying to reduce costs and increase production. So what we’re targeting is incrementally increasing production at Bjorkdal and incrementally decreasing costs. We are suffering a little bit because we’re working in the Swedish krona—which is all our operating costs—and it’s been very strong against the US dollar. But production-wise, I believe that Bjorkdal has a long future ahead, and we’ll incrementally increase production as we move forward.”

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