San Gold Corporation is focused on gold exploration and mining in the Rice Lake greenstone belt in the Province of Manitoba, Canada, with two mines, a mine mill, four gold deposit discoveries and ownership or control over nearly 15,000 hectares of exploration lands.
The Rice Lake Mine was formerly known as the San Antonio Mine or Bissett Mine and was earlier in production for one period lasting 36 years, during which 1.35 million ounces of gold was produced, and a second period lasting two years, during which 210,000 ounces of gold was produced. The Rice Lake Mine resumed operations under San Gold Corporation during 2006. Its A-shaft penetrates 4,050 feet below ground and connects via a 5,000-foot crosscut to D-shaft and a spiral ramp, which penetrate another 900 feet and 760 feet of depth respectively.
The Mine is situated within the Rice Lake greenstone belt at the western end of the Archean Uchi Volcanic-Plutonic Subprovince, which stretches from Lake Winnipeg to James Bay and also contains the prolific Red Lake and Pickle Lake gold producing belts. The bedrock in the area of the Mine consists of the Bidou Lake Subgroup, which is made up of felsic to intermediate volcanic flows and dacitic crystal tuffs and breccias overlain by carbonate-sericite schist. The sequence is intruded by diabase sills and dykes, and porphyritic felsic dykes. The Bidou Lake Subgroup is unconformably overlain by feldspathic sandstone of the San Antonio Formation. Mineralization at the Mine is confined to a layered, sill-like gabbroic unit which intrudes the Townsite Unit of the Bidou Lake Subgroup and is known as the San Antonio Mine Unit. At San Gold #1 gold mineralization is confined to a sericite schist and quartz-carbonate unit which forms part of the volcanic stratigraphy of the Bidou Lake Subgroup.
Mining operations at the Rice Lake Mine focus on the high grade 98 Vein in the Rice Lake East portion of the mine, about 4,100 feet below the surface. Underground exploration drilling has discovered a new high grade gold zone beyond the eastern limits of known exploration from the 28th and 26th levels of the Mine. The zone is located approximately 150 meters to the east of the 98 Vein area.
Unlike the Rice Lake Mine and the Cartwright deposit, the high grade Hinge gold zone is not hosted by the San Antonio Mine Unit. It was discovered in March, 2008 one kilometer east of the Rice Lake Mine as a result of exploration for gold-bearing structures in the Townsite Unit in the hanging wall of the San Antonio Mine Unit. It is comprised of veins consisting of quartz with carbonate and minor sulphides. Exploration of the Hinge zone is the result of a change in geological model at the Rice Lake Project, from a model focusing on chemical change in the hanging wall or north portion of the host San Antonio Mine Unit to a structural model of vein deposition. The new structural model projects a series of north-south hinges or axes on the basis of deep underground observations and surface structural interpretations.
Bulk sampling of the Hinge gold zone took place between March and July, 2009. The zone is connected to the surface by a 1,000 meter decline. Mining is being conducted about 400 feet below surface, with ore being transported to the surface by truck. Full-scale mining operations should commence during 2010.
Like the Hinge Mine, the 007 Zone is located outside of the San Antonio Mine Unit. It is located 600 meters to the southeast of the Hinge Mine and was discovered in 2009 as part of the same exploration program which resulted in the discovery of the Hinge zone.
Surface exploration drilling in Spring, 2010 expanded the vertical dimensions of the 007 zone in both up and down directions. A continuous, high grade deposit has now been established from surface to a depth of 450 meters. It is expected that the 007 zone will commence mining operations in the Summer of 2010 and will be accessed 800 feet below surface utilizing a 2,400 foot drift from the Hinge portal.
In April, 2010 Geoex Limited prepared a study with an effective date of December 31, 2009 providing an initial resource estimate for the Hinge and 007 zones. The mineral resource estimate in the report is summarized as follows:
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The mill, constructed in 1997, is located immediately adjacent to the Rice Lake Mine, and the Hinge Mine portal is located 600 meters away. The mill has a capacity of 1,200 tons per day. The tailing containment facility is fully permitted.
Following crushing and grinding of the run-of-mine ore, gravity concentration systems are used to obtain approximately 50% of contained gold, while a flotation and carbon-in-pulp circuit is used to obtain the remainder. Smelting and production of gold doré bars occurs on site.
Tailings effluent is discharged to the tailings pond northeast of the mill. In the tailings pond settling of solids occurs and water from the pond is then transferred to a polishing pond from which, after a suitable dwell time, water is discharged to the environment in accord with provincial licensing requirements and federal regulations.