The Blackwater gold project has been acquired by a gold producing company who hope to see an open pit mine up and running at the site by 2017.
The project is located 100 kilometres south of Vanderhoof on the Nechako Plateau and was sold for $500 million by junior mining company Richfield Ventures who have been conducting gold exploration at the site for a number of years.
New Gold, an intermediate gold producer with other projects in Mexico, the United States and Australia, closed the deal with Richfield Ventures at the end of May, officially taking over the site on June 1 this year.
“The ultimate objective is to build Blackwater into a successful project that contributes significantly to the economic well being of all the stakeholders and shareholders,” Bob Gallagher, President and Chief Executive Officer of New Gold.
The gold present at the site is relatively low grade, Gallagher explained, which means a lot of capital is required to extract the mineral.
“There’s basically one gram of gold per ton of rock,” he said.
“That means if you can imagine a million grains of sand … one of them would be gold.”
“And that means that it takes a lot of capital … that’s why companies like Richfield end up selling it to the bigger guys,” he said.
The site has direct access from Vanderhoof via the Kluskus Forest Service Road and then another unnamed logging road for the last 20 kilometres.
BC Hydro have identified four alternate right-of-ways for a high voltage power line to the mine.
A 40-50 man camp is already located at the site, but New Gold are currently in the process of expanding it to a 100 man camp which they hope will be completed by the middle of October this year.
A number of contractors from Vanderhoof are currently working on the camp expansion.
Drilling at the site also continues, and plans are to bring more drills in and to continue drilling through the winter.
“Basically our next stage is to do a lot of drilling.
“We’re currently using five drills … and we hope to get the camp built so we can bring in five more drills and get ten going,” said Gallagher.
At present it has been announced that there is an estimated four million ounces of gold at the site, but Gallagher hopes the figure will end up being a lot more than that.
“Some of the biggest deposits in the world are 10 million ounces and up and that’s considered huge … we think … that we’re going to move well above four million – I don’t know if we’ll make it to ten but well above four million,” said Gallagher.
By the end of 2012, New Gold hope to have a project description written out which will describe how big the project will be and what the general concepts are. The project description document is what initiates the permitting process which takes about three years.
While Gallagher says he can’t guess at the size of the mine yet, New Gold plans to build it to have a 12-15 year life minimum.
He also estimated that the mill is going to be a similar size to those at other nearby mines such as Endako or Huckleberry.
As the mine moves through its various stages of development, numbers of employees at the mine will fluctuate.
“So what you will see is a lot of drilling now and probably about 100 people working on the site.
“This will taper off somewhat when we start our key environmental studies … as we get into construction you’ll probably have 600-800 people building the mine and in addition to those 600-800 there will be about 350 permanent employees.”
Hannah Wright, Vanderhoof Express
