-- Published: Friday, 15 July 2016 | Print | Disqus
COEUR D'ALENE, Idaho, July 15, 2016 (GLOBE NEWSWIRE) -- New Jersey Mining Company (NJMC) (“NJMC” or the “Company”) announced today that it is set to begin small-scale open pit mining operations at the Golden Chest Mine near Murray, Idaho.
NJMC President John Swallow stated, “We are excited to move toward resumption of operations at the Golden Chest Mine. During the recent period of lower gold prices and lackluster sentiment within the industry, we have consolidated property ownership at the Golden Chest, secured necessary equipment, and further refined our surface and underground mine plans.”
Mr. Swallow continued, “We view the Golden Chest Mine as one of the most advanced, production-ready gold projects in the western United States. Although we are beginning with a modest mine plan, the mine area occupies only a small portion of our district-scale land holdings. The underground development by Juniper provides us a quality platform to further evaluate the surrounding area and, as possible, expand operations.”
Ore from the open pit will be shipped to the New Jersey Mill. Open-pit mining this summer and fall is expected to generate cash flow while the underground mine workings are dewatered. See the NJMC news release dated June 21, 2016 for more details.
To fund the commencement of open pit mining operations, NJMC has secured a private investment, subscribed to by Company management through Ophir Holdings LLC. The agreement calls for Ophir to forward purchase 500 ounces of .999 gold at $935 per ounce, to be delivered or converted to cash at its option starting December 1, 2016 and quarterly thereafter, over two years as gold is produced from the Golden Chest Mine and New Jersey Mill.
Earlier this year, NJMC completed an internal scoping study and developed an initial mine plan at Golden Chest, focused on unmined ore from the Juniper mine plan and from other accessible, drill-tested zones. The mine plan has a 3,000-tonne per month production target with all material to be processed at the New Jersey Mill. The mine plan is focused on the main Skookum Shoot orebody which remains open down-dip with substantial exploration potential in other areas including up-dip and on-strike extensions.
NJMC recently purchased an underground haul truck and loader, received long-lead electrical components, and signed an agreement to use idle mining equipment held by the Butte Highlands Joint Venture (50-percent NJMC). With the mine fully permitted, NJMC can resume underground mining operations immediately following dewatering and any needed rehabilitation, subject to obtaining additional financing.
In September 2013, the Skookum Shoot portion of the Golden Chest Mine was leased to Juniper Resources LLC which, through its affiliate companies (“Juniper”), developed a state-of-the-art gold mine that began producing ore in late-2014. In September 2015, Juniper ceased operations and terminated its lease, forfeiting the remaining mineralized material and mine infrastructure.
NJMC processed Golden Chest ore at its New Jersey Mill during the Juniper Lease, earning cash from milling fees and its share of a 2-percent net smelter return (NSR) royalty on gold production. Juniper mined 40,840 dry metric tonnes of ore at an average grade of 6.70 grams per tonne gold, resulting in production of approximately 8,000 ounces of gold.
The development performed by Juniper was based largely upon prior work done by Golden Chest LLC. In 2010, NJMC contributed certain mining claims, all geological data, and certain mining equipment to form Golden Chest LLC with Marathon Gold Corporation, which contributed $4-million cash. In 2011 and 2012, Golden Chest LLC completed the most aggressive exploration programs in the property’s history, including 144 core drill holes (totaling 18,300 meters). A NI 43-101 technical report was completed in 2012 and an updated NI 43-101 compliant Resource Estimate was released in 2013. Following the termination of Juniper’s lease, NJMC bought out Marathon’s interest in Golden Chest LLC in December 2015.
About New Jersey Mining Company
New Jersey Mining Company is headquartered in north Idaho, where it is deploying its mining and milling expertise to build a portfolio of advanced-stage assets with near-term cash flow potential and leverage to higher gold prices.
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-- Published: Friday, 15 July 2016 | E-Mail | Print | Source: GoldSeek.com
