Laurion Plans 2013 Gold-Silver Production
By Greg Klein and Kevin Michael Grace
2008: A global credit crisis shattered the commodities market. The mining industry struggled just to survive. Hardest hit were junior explorers, considered especially risky by panicked investors. As a result, Laurion Mineral Exploration President Cynthia Le Sueur-Aquin made a pivotal decision. “We needed to modify our vision and transition from exploration to production rapidly,” she says. “Hence the acquisition of Bell Mountain.”
The Nevada property’s key attraction was its historic resource of 2.1 million tonnes averaging 1.3 grams per tonne gold and 37.5 g/t silver. “The historic resource is encompassed within 26 mineral claims,” Le Sueur-Aquin says. “We staked an additional 119 claims to make sure we encompassed the full strike of the Spurr-Varga and the Sphinx zones in which the historic resource was contained.”
A 56-hole drilling campaign followed, confirming that the zone is between 15 and 30 metres wide. “It has potential to continue and can be traced on the surface for about 1.8 kilometres,” she adds. “We increased the historic resource from 133,870 gold-ounces equivalent to 311,647 gold-ounces equivalent in this drill program.”
An April 2011 resource estimate shows a measured and indicated resource of 9,761,000 tonnes at 0.526 g/t gold and 17.63 g/t silver, with 165,018 gold ounces and 5,533,907 silver ounces. The inferred category shows 2,046,000 tonnes at 0.449 g/t gold and 13.26 g/t silver, with 29,550 gold ounces and 872,411 silver ounces.
“Depending how you look at it, it’s either a gold-silver project or a silver-gold project,” she says. “The 43-101 was based on $1,149 an ounce for gold and $20.92 for silver. We have run our own in-house analysis and estimate a 1.5:1 strip ratio, 80% recovery for gold and 50% recovery for silver. The mining cost for this project is roughly $11.43 per ton. With an estimated CAPEX of less than $10 million, that all adds up to an extremely robust project.”
Laurion plans a PEA, possibly by 4Q 2011, an economic assessment by 2012 and production by mid-2013. Bell Mountain will be an open-pit mine with heap-leach processing.
Half a continent away, in the Beardmore-Geraldton Gold Camp north of Thunder Bay, Ontario, sits Laurion’s Sturgeon River project. “This project has us extremely excited,” Le Sueur-Aquin says. “It was mined between 1936 and 1942, producing about 73,439 ounces of gold and 15,922 ounces of silver. We believe that Beardmore-Geraldton is especially underdeveloped and undiscovered. Historically the old-timers mined an average of 17 grams per tonne.”
Sturgeon River property assays released May 26 reveal 3.22 g/t gold, 27.5 g/t silver, 0.38% copper and 5.63% zinc over 3.1 metres (including 10.4 g/t gold, 77.1 g/t silver, 0.83% copper and 14.3% zinc over 0.8 metres), 0.1 g/t gold, 10.1 g/t silver, 0.11% copper and 2.85% zinc over 5.9 metres and 0.94 g/t gold, 3.3 g/t silver, 0.07% copper and 0.48% zinc over 2.4 metres.
There is liquidity in the market now, but it has not found its way back to the resource sector—certainly not to the juniors —Cynthia Le Sueur-Aquin
March 21 assays reveal 4.19 g/t gold over 1.1 metres (including 8.96 g/t over 0.5 metres), 1.24 g/t over 3 metres (including 4.5 g/t over 1 metre), 1.36 g/t over 2 metres, 15.3 g/t over 0.6 metres and 1.04 g/t over 3 metres.
Le Sueur-Aquin comments, “What we found very exciting is that we encountered several gold zones within the shear zones which envelope the quartz veins. The historic geophysics and soil sampling indicate a number of zones adjacent to the shaft and to the north which indicate further potential within this shear zone.”
“Right now our focus is to identify all the targets of significance to form a picture of Sturgeon River’s full potential,” Le Sueur-Aquin adds. “That has increased substantially over the last year.” An eight-hole drill program began there July 6.
The company has about $1.3 million in cash with a burn rate ranging from $50,000 to $70,000 a month. A private placement of up to $1.25 million was announced June 23. At press time it had 74.2 million shares outstanding at $0.075 per share for a market cap of $5.57 million. Insiders hold approximately 6.5% of the shares.
The goal of putting Bell Mountain into production is central to Laurion’s plans, Le Sueur-Aquin declares. She concludes, “The resource estimate shows we generated a significant amount of value, and we are confident that this will soon be represented in the share price value. Exploration companies are considered high risk. There is liquidity in the market now, but it has not found its way back to the resource sector—certainly not to the juniors. Our new vision is to generate our own revenue by metamorphosing from an exploration company to a producing company. I believe that will prove instrumental to our success.”