Grenville plans to ship, process rock from Silveria
2007-09-04 14:06 ET - News Release
Mr. Paul Gill reports
GRENVILLE BEGINS TO SECURE & PRIORIZE STOCKPILES OF MINERALIZED ROCK FOR TRANSPORTATION & PROCESSING
Grenville Gold Corp. has assessed, as per Section 21.2, Section 3.32 and Section 3.4.1 of National Instrument 43-101 on the Silveria project, the accessible rock dumps, and identified, secured and priorized surface material ready for transport. Also, the company will be stockpiling mineralized rock removed from the Alanzia and Reserva mine portals and various rock dumps located near access roads to these portals. No feasibility study has been performed on the project and no estimates are available as to the end value of the mineralized rock.
The above paragraph only refers to a small portion of the rock dumps on the Silveria property and does not include the tailings or the underground backfill. The process of locating and classifying rock dumps is crucial to the company's short-term objectives. Up to 34 mine rock dumps were sampled and results were reported in Stockwatch news June 4, 2007. Additional testing will confirm the grade and quantity of the material, but processing bulk samples is the most cost-effective way to establish if this activity will produce positive cash flow. Currently, the operating cost for removal of mineralized rock from the underground to a mill is estimated at $45 per ton as per Section 21.2 (below).
"Grenville must be prepared to ship this material as we have identified a demand for mill feed in the vicinity of the Silveria property," stated A. Paul Gill, president and chief executive officer. "The estimated cost of extraction has been established based on past production and implementation of new techniques. Processing bulk samples from this material will identify cash flow potential."
As reported in Stockwatch news July 17, 2007, Grenville has purchased the surface rights for a 3,393-hectare land package which gives it control of all surface land underlying the Pacococho, Millotingo, Silveria and Germania mines, which are all former producers, located within the Silveria project.
Grenville has previously reported that the Pacococha and Millotingo mines had produced 18 million ounces of silver. Additional information collected during the 43-101 process indicates that the known production from the former mines is estimated to be closer to 39 million ounces of silver.
Excerpts from the referenced 43-101 report
21.2 operating cost estimate
Rationalization of the stoping operations, a change in stoping strategies, the use of in-stope slushers, improved rock handling facilities and a more efficiently run mill would reduce the unit cost per ton milled to an estimated target figure of about $45 (U.S.), which comprises:
- A target unit stoping cost of about $20 (U.S.) per ton of mill feed delivered to surface;
- A target unit processing cost of about $20 (U.S.) per ton of mill feed, including transport costs from surface to the mill;
- A management overhead totalling about $5 (U.S.) per ton milled.
3.3.2 mineralized rock dumps
Numerous mineralized surface rock dumps of various sizes exist across the project area, especially in the Pacococha and Silveria mining areas. The presence of such material may be explained by the selective nature of vein drift development and stoping activity. Individual veins were opened up/explored by means of vein drifting. Stoping took place above only those sections of developed vein drift that were deemed to have intersected economic mineralization. Subeconomic material from the developed vein drifts was dumped as waste, either on surface or in mined-out stopes.
3.4.1 short-term objectives
The company's main short-term objective is to establish positive project cash flow, at the earliest opportunity, by reprocessing available tailings. The secondary short-term objective is to produce ore from the existing underground workings. To this secondary end, once all the relevant data are in place, formal reserve statements, reserve depletion models, stoping schedules and cash flow models will be compiled. Initially at least, produced material might be sold direct to adjacent operations for processing. Integrated with these objectives will be detailed considerations of the cash flow potential of either selling or processing material from the numerous mineralized rock dumps.
We seek Safe Harbor.
