FAU: TSX.V
FVGCF: OTCQX
FWR: FSE
VANCOUVER, July 5, 2011 /CNW/ - Fire River Gold and Mystery Creek
Resources (collectively "the Company") are pleased to provide the
following update for the Nixon Fork Mine. It is a thorough document
that provides insight into all aspects of operations at site. All
photos contained in this release were recently taken and represent
current conditions at site.
Start Up Schedule
The mill was started up on July 4th. Only the gravity and flotation circuits are being run, which will
achieve approximately 80% recovery of gold from freshly mined ore.
The crushing circuit has already been operating this past week as a
commission task and to prepare road surfacing material for
construction. See Figure 1 for a picture of the primary jaw crusher in
operation.
The start up plan for the plant is to process barren waste for a few
days to get the material flowing through the mill. Next, low grade
mineralized rock (2 to 8 g/t) will be processed over the next week as a
"breaking in" period for the gravity and flotation circuits. After the
breaking in period, the mill should be fully operational on gravity and
flotation circuits and will start processing higher grade feed.
Completion of the cyanide-in-leach (CIL) circuit will be ongoing during
start up, with mechanical completion and commissioning projected for
late fall. Adding the third process should bring total recovery up to
96%.
The mine and mill should be fully operational and near capacity at 150
tpd of fresh ore from the mine by the end of October. By late spring of
2012, ore feed from the mine will be supplemented by recovering an
additional 100 tpd of tailings from the existing tailings pond, which
grades approximately 7.6 g.t (Giroux, 2010).
The key project objectives dates are summarized as follows:
- July 4- Mill start up
- Late July - First concentrate shipment of 30 tonnes from Anchorage
- Mid to late August - First doré gold pour from gravity concentrate
- Early September - Dry stack construction completion
- September/October - Mechanical completion of CIL plant
- Late October - Commissioning of CIL, start of leaching
- Late Spring 2012 - Leaching historic tails from pond
http://www.firerivergold.com/i/photos/070511p1.jpg
Figure 1: Jaw Crusher in Operation
The Mill
There were several modifications made to the existing mill that were
performed concurrent with construction completion of the CIL plant:
-
At the crushing plant, the crush size was reduced from 2 inches to 1
inch passing, which is a standard practice. This should reduce the
grinding requirement and could increase the capacity of the mill.
-
The feed to the centrifugal gravity separator used to come from the
cyclone overflow. This has been re-routed to draw from the cyclone
feed. This should increase gold recovery and system operational
reliability. Gravity gold is the cheapest to process and has the
highest value, so this will have a strong economic benefit to
operations.
-
A slurry storage tank was added between the concentrate thickener and
filter to decouple the two processes and make them more efficient.
Peristaltic pumps were also installed to maintain a high density and
low flow. In past operations moistures as high as 20% were reported in
the concentrate. We anticipate a much lower moisture content of in the
new concentrate.
The flotation circuit is very simple, using only xanthate and frother.
No pH control is required. As such, no improvement to the existing
circuit was deemed necessary. Our objective will be to moderate copper
content in the concentrate, which varied from 10 to 25% historically.
http://www.firerivergold.com/i/photos/070511p2.jpg
Figure 2: Gravity and Flotation Circuits at the Mill
The Carbon-In-Leach (CIL) Circuit
Two of the five cyanide leach tanks have been fully installed and a
third is partially complete. Though at site, these were delayed so that
several smaller installation around the large tanks would not be
obstructed.
The main components of the carbon stripping and electrowinning circuits
have been installed. Piping and electrical work will start in earnest
in mid August. Nearly all remaining equipment is at site, the exception
being the agitators for the detox tanks, which are the critical path
item for mechanical completion, which is anticipated for mid September.
A cyanide source has been secured for delivery in October.
http://www.firerivergold.com/i/photos/070511p3.jpg
The Filtered Tailings Disposal Site (Dry Stack)
The original design of the dry stack was for water collection beneath
the sand in porous pipes, transferring to a pond for sampling and
percolation into the earth. The company elected to line the dry stack
and enlarge and convert the percolation pond to a lined collection pond
to make this a zero discharge facility. This is the only significant
construction activity outside of the mill building in 2011. A fleet of
construction equipment is being assembled at site, including an
excavator, dozer, front end loader, and articulated truck for this
work. A crew of six will complete this construction by the end of
August. Completion of the dry stack is necessary prior to the
commissioning of the CIL circuit.
The Mine
The mine has been in operation for several months, with mine
rehabilitation, ore stockpiling, waste development, and diamond
drilling being the primary activities.
All mine rehabilitation work is complete, the largest project being the
refurbishing of the ventilation raise which serves as a secondary
egress.
Two primary waste headings are being driven: 1) the Crystal Ramp is
being extended to depth to access the down-dip extensions of 3000 and
3300 zones and 2) a shallow ramp is being driven from the Crystal Mine
to connect it to the Mystery Mine. To-date the Crystal Ramp has been
driven 42 m and the Mystery drive has been driven 90 m. A ventilation
drift for the Crystal ramp extension has also been completed, a
distance of 33 m.
The Mystery Mine connection drift is a shallow ramp, driven at 6% grade
from the Crystal Mine, starting at 170 mASL. This connection is crucial
to future operations, as it will open up the Mystery Mine for mining
operations (current resources in the Mystery Mine are 28,400 tonnes indicated grading 23.7 g/t for a total of 20,900 indicated oz Au using a cut-off
grade of 10 g/t, from Giroux, 2010). It will also provide excellent
drill platforms to explore the zone between the mines, including the
Southern Cross and J5A mineralized zones.
Mining and development activities are still ramping up to full capacity
as the manpower expands to its full complement of 90 site employees.
Approximately half of the new production mining fleet has arrived at
site, including a one-boom Tamrock jumbo, BC2 longhole drill, 4 yd³
R1300 scooptram, and a 20 tonnes Dux truck. A second Dux truck and
R1300 scooptram are scheduled to arrive early in June. The second
scooptram will be remote-capable, expanding stoping method options for
the operation. Additional equipment is being considered to enhance
productivity, including a rockbolting machine. The mine is expected to
achieve its full production target of 3800 ounces per month by October
2011.
http://www.firerivergold.com/i/photos/070511p4.jpg
Figure 3: Mine Equipment Purchases (L to R: One Boom Jumbo, 4 yd³
Scooptram, LH Drill)
Stockpile Management
At present a stockpile of approximately 2300 tonnes of high grade
material and 100 tonnes of medium grade material is stored in front of
the primary jaw crusher outside of the mill building (Figure 4). In
addition, approximately 500 tonnes of low grade material has been
stored on a nearby laydown (Figure 5). This material is segregated into
piles awaiting grade determination by assay (note the identifying
stakes for each pile) before being added to one of the piles or
disposed of onto the waste dump.
http://www.firerivergold.com/i/photos/070511p5.jpg
Figure 4: High Grade Stockpile (left) and Medium Grade Stockpile (right)
ahead of Primary Crusher
http://www.firerivergold.com/i/photos/070511p6.jpg
Figure 5: Low Grade Stockpile (to right) and Unclassified Material Piles
Water in the Mine
There is much speculation, but few facts known about the groundwater
situation in the mine. At present there is approximately 3 m of water
at the bottom of the old ramp and approximately 0.3 m in the new ramp
heading. The water level in the mine is known to fluctuate as much as 6
m in the spring after the snow melt.
While the full extent of the groundwater significance is not known, the
mine is taking several steps to manage groundwater inflows should they
become problematic to the crystal ramp development, including:
-
Locating the drive in tightly healed limestone
-
Installing a 200,000 gallon reservoir at 170 mASL to pump inflow water
(completed July 3rd) and a second 70,000 gallon reservoir at 340 mASL for drill water
storage
-
Diamond drilling ahead of the development heading to explore groundwater
and fracture conditions
-
Acquiring a large capacity grout pump and contracting experts to guide
the grouting program should one be required
-
Acquiring four evaporation misting machines to dispose of excess
groundwater through accelerated surface evaporation (one unit is
already in service at the tailings pond, see Figure 6).
http://www.firerivergold.com/i/photos/070511p7.jpg
Figure 6: Evaporation Mister at Tailings Pond
Drilling
The mine has two Hagby drills that have been operated underground over
the past several months. Drill results have been extensively covered by
numerous press releases over that period.
The main objective of recent drilling was ore definition in support of
the earliest mining in the upper Crystal Mine, approximating the first
six months of production. This work is complete and the drills are now
being turned to exploration targets on surface and underground. The
most important target for both is the zone between the Mystery and
Crystal mines, which houses three targets: the Southern Cross, J5A, and
3100 zones. These will be more effectively drilled once platforms have
been provided by the shallow ramp connecting the Mystery and Crystal
Mines.
The Company maintains that the property is fairly large and the ability
to replenish mining on an annual basis is a probable and appropriate
approach to extending the life of the operation.
http://www.firerivergold.com/i/photos/070511p8.jpg
Figure 7: Hagby Drill Set Up Underground
Assay Lab
One challenge of start up has been to fully staff the assay lab, which
has been accomplished with the addition of four assayers.
While the ore is visually discernable, the precise grade is not, and
there is enough latitude that the geologists are regularly surprised in
both directions - assays demonstrating higher and lower grade than
expectations based on visual examination. Accordingly, a quick
turn-around of assays is necessary to properly manage the determination
of ore and waste. The number of results per day will increase with mill
start up, as the underground testhole, chip samples, and muck pile
samples with be joined by numerous daily checks on mill feed, gravity,
flotation, concentrate and final tailings determinations.
Diamond drill samples are still assayed independently such that they can
be used to support resource and reserve estimations.
http://www.firerivergold.com/i/photos/070511p9.jpg
Figure 8: Fire Assaying for Stockpile Grade Determination
Marketing Contracts
Negotiation of contracts for the off-take of concentrate and dore bars
are under active discussion with a number of major buyers. The
concentrate will leave site in 1 tonne totes on pallets aboard a C130
Hercules aircraft. The doré will be shipped in 25 to 30 kg bars that
will be comprised of gold (60%), silver (30%), and impurities (10%). No
delay to revenue is anticipated due to completion of either contract.
Security
A contract has been awarded to an independent contractor Doyon Universal
Services LLC for continuous surveillance of the mill area and to
accompany all shipments from site. The Company is confident that the
surveillance equipment installed coupled with the diligence of a
third-party security team will protect the operation from losses due to
theft.
Logistics
Being an air-support operation, efficient logistics are crucial to the
property's success. Our primary fuel supplier, Everts Air Cargo, has
successfully built up our inventory at site such that for the first
time in our project's history we refused a fuel flight last week.
Figure 9 shows the Everts DC-6 offloading fuel into the Nixon Fork
tanks. Note that the art on the nose depicts the plane's original
owner, Mr. Howard Hughes.
http://www.firerivergold.com/i/photos/070511p10.jpg
Figure 9: Everts Air Cargo's DC-6 Transferring Fuel
Most of the heavy equipment at site was lifted from Anchorage aboard a
Lockheed C-130 Hercules airplane, supplied by Lynden Air Cargo (Figure
10). This plane will also be used for all bulk supply, such as cyanide,
lime, cement, and to fly copper concentrate from site. Excess payload
capacity is often exploited by offloading wing fuel from the plane to
our fuel storage tanks.
http://www.firerivergold.com/i/photos/070511p11.jpg
Figure 10: Lynden C-130 Hercules Airplane Arriving at Nixon Fork Mine
Anchorage Office
The Company has established an Anchorage office, which is embedded in
Lynden's main facility. Project accounting, human resources, and
logistics coordination will be managed from this office.
Closing Comments
Needless to say we are all excited about achieving this milestone. I am
very proud of our workers and our management and thank each employee,
consultant, and contractor whose contribution got us to this point. It
has certainly been a team effort with many helping hands.
On behalf of the Board of Directors,
(signed)
------------------------------------------------------
Richard Goodwin
President & COO
Disclaimer: Certain information regarding the Company including management's
assessment of future plans and operations, may constitute
forward-looking statements under applicable securities laws and
necessarily involve risks associated with mining exploration and
development, volatility of prices, currency fluctuations, imprecision
of resource estimates, environmental and permitting risks, access to
labour and services, competition from other companies and ability to
access sufficient capital. As a consequence, actual results may differ
materially from those anticipated in the forward-looking statements. A
feasibility study has not been completed and there is no certainty the
disclosed targets will be reached nor that the proposed operations will
be economically viable. Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the policies
of the TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. Neither TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the policies
of the TSX Venture Exchange) accepts responsibility for the adequacy
accuracy of this release. We seek safe harbour.
<p> Tel: +1 604 685 1870 Fax: +1 604 685 8045<br/> Email:<a href="mailto:info@firerivergold.com">info@firerivergold.com</a> or visit <a href="http://www.firerivergold.com">www.firerivergold.com</a><br/> 2303 West 41st Avenue, Vancouver, B.C., Canada, V6M 2A3 </p>