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By Shane Lasley
Mining News 

Fire River joins Alaska's gold producers

Ratcheting up operations at Nixon Fork, junior miner anticipates churning out 50,000 ounces of gold annually; first doré in August


Last updated 7/31/2011 at Noon

Fire River Gold Corp. has fired up the mill at its Nixon Fork Mine, placing the Vancouver B.C.-based junior on the short list of Alaska hardrock gold producers.

"Startup is going very well. We started with about 3,000 tons stockpiled (ore) ahead of it, which to most operations that does not sound like a lot but our monthly production is only about 4,000 tons a month," Fire River President Richard Goodwin told Mining News July 21.

Though the 150-metric-ton-per-day operation is much smaller than its peers in the state, gold grades in the 1-ounce-per-metric-ton range helps make up for some of what the mine lacks in stature. When running at its full capacity, the reinstated operation is expected to churn out around 50,000 ounces of the precious metal a year.

With the smooth startup, Fire River is looking forward to pouring its first gold around the third week of August.

About half of Fire River Gold's revenue from Nixon Fork, which is located some 35 miles (56 kilometers) northeast of McGrath, will come from the sale of 1,000-ounce doré containing 60 percent gold and 30 percent silver. Additional cash flow will be generated from the sale of a copper concentrate that will be shipped to a smelter.

Phased production

The ramp-up to operations started in late June when the Vancouver, B.C.-based junior miner began commissioning the crushing circuit. This task not only dialed in the crushers but produced some gravel for the roads around the mine.

Fire River brought the gravity and flotation circuits on line July 4. For the first few days, recovery systems were fed rock bereft of any gold followed by low-grade ore. Comfortable with the plant's performance, operators began feeding the mill high-grade ore from the upper portions of the Crystal Mine July 11.

Goodwin attributed the quick break-in period to the fact that the plant had been operated on-site in the past.

Nevada Goldfields Inc. constructed and operated the mill at Nixon Fork from 1995-1998. That company reported recovering 137,749 ounces of gold and 2.1 million pounds of copper, with additional silver credits during roughly three-plus years. It shuttered the mine in 1999.

The gravity and flotation circuits recovered some 83 percent of the gold during this past operation and Fire River is reporting similar recoveries.

"The mill has done exceedingly well. Recoveries are what we anticipated, above 80 percent and that is largely because it did operate in the past. It is not like commissioning a brand new, freshly-designed mill," Goodwin said.

The gold and silver captured in the gravity circuit will be turned into the doré that Fire River is eager to produce. The plant is expected to churn out about two of these nearly US$1 million bars a month during this early phase of operation.

The addition of a carbon-in-leach cyanide circuit is expected to boost the recoveries to around 96 percent.

Crews have installed two of the five cyanide leach tanks needed. The fitting of the remaining three tanks was put on hold to allow for adequate room to complete some of the other smaller installations. The cyanide recovery system is scheduled to be completed in September and added to the recovery circuit in October.

Once all three circuits are in operation and the mill is running at its full 150-metric-ton-per-day potential, the Nixon Fork Mine is expected to produce some 3,800 ounces of gold per month throughout the winter.

Gold captured by the cyanide circuit also will be poured as doré, boosting the frequency of output of these bars to about three per month.

By late spring of 2012, Fire River plans to ratchet up production again to 250 metric tons per day by re-processing tailings from the historical mining.

The tailings pond contains some 140,000 metric tons of pre-milled material estimated to average 7.6 g/t gold, most of which is expected to report to the cyanide circuit.

Fire River Gold will only run the tailings - which are locked up in ice during the cold Interior Alaska winter - through the mill during the summer months. Gold recovered from this bonus material is expected to result in an extra doré bar per month at Nixon Fork.

The timing of this augmented production will be dependent on the spring thaw and the installation of the pumps needed to get the gold-laden tailings up 100 vertical-meters to the mill.

Reaching Mystery

Based on re-assaying more than 10,000 meters of drill core left behind by the previous operator, Nixon Fork has underground resources of slightly more than 190,000 metric tons, averaging 27 g/t gold. That's enough ore to keep the 150-ton-per day mill operating for four years.

Much of the underground drilling completed at Nixon Fork during the past year has focused on confirming and expanding on these deposits of high-grade ore. The primary target of this drilling was in the upper Crystal Mine.

Drilling in the lower portion of Crystal has returned encouraging results and could add to the minable high-grade ore available in this area.

The underground workings at Nixon Fork are divided into two unconnected mines, Crystal and Mystery.

The upper portion of Crystal, which is nearest the mill, is the first area being mined. Goodwin estimates there is enough ore here to feed the mill between six and eight months.

While mining the upper portions of Crystal, crews are driving a shallow ramp to Mystery Mine about 600 meters to the northeast and ramping down to the lower portions of Crystal.

"After the first six months we will start mining the Mystery side as well as the down-dip extensions on the Crystal," Goodwin explained.

Mystery currently has an indicated resource of 28,400 metric tons averaging 23.7 g/t gold. The underground connection will not only provide easier access to this 20,900 ounces of the yellow metal, but also will provide a drill platform for the Southern Cross, J5A and 3100 zones - three promising targets between the two mines.

Pleased to have realized its goal of becoming Alaska's newest hardrock gold producer, Fire River Gold took a moment to show its appreciation to the companies and people that played a part in making it possible.

"Needless to say we are all excited about achieving this milestone," Goodwin said. "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."


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