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Investors seeking more 'stable' ground.

Investors seeking more `stable' ground

The amount of gold exploration in Thunder Bay district continues to decline.

District resident geologist Maurice Lavigne said there was a 47-per-cent decrease in activity by junior mining companies from 57 active properties in 1988 to 30 properties in 1989.

Currently there are no producing gold mines in the Thunder Bay district.

Lavigne said the slump in exploration activity is a result of the scarcity of risk capital.

The investment market has been vulnerable "since the crash of 1988," he explained.

According to the resident geologist's report, the number of active properties decreased by 38 per cent to 65 in 1989 from 105 in 1988.

If measured by the number of man-days of assessment work filed, the decrease was 36.5 per cent.

Lavigne believes the situation will not improve as long as interest rates remain high.

"Investors are more likely to invest in a more stable market than in exploration. They will invest in high-interest bonds, for instance."

Lavigne said the level of exploration and production is much less now than during the same time last year.

"I can't foresee much change," he added.

Lavigne said most of the activity recorded in the area focused on gold, with only a slightly increased emphasis on base metals and a decrease in exploration for platinum.

Of the 65 properties explored in 1989, seven were for base metals and five for platinum. The balance were gold properties.

Lavigne said there has been some base metal exploration activity in the Shebandowan greenstone belt and there are currently two large gold programs being carried out in the Atikokan area.


Madelaine Mines Ltd. continued site preparation at its Lac des Iles platinum metal group prospect in 1989. It removed overburden at the open-pit site and installed a crushing circuit and floatation cells.

The first blast in the new open pit took place during 1989.

Operating in the area since 1979, the company hopes to complete the construction of a mill which is expected to accommodate 3,000 tons of ore per day.

Expected to be in operation shortly, the mill will handle ore graded at .185 ounces of platinum per ton.

Mimiska Mining Company carried out an extensive feasibility study of its Fern-Elizabeth prospect in 1989.

Drill-indicated reserves on the four explored veins are 375,000 tons of ore with an estimated grade of .18 ounces of gold per ton.

The company conducted some 33,250 feet of diamond drilling in 65 holes at its Atikokan property, with the bulk of the exploration revolving around Harold Lake.

Of the 21 holes drilled in this area, 10 holes investigated a zone with estimated 44,000 tons grading .19 ounces of gold per ton.

After conducting three years of developmental drilling in the area, Mimiska senior geologist Bill Yeomans said the company is currently seeking financing for an underground exploration program.

The pre-production phase would include ramping to the 500-foot level and bulk sample testing to better evaluate the deposit prior to further development.

"We have to determine whether it will be economically feasible to get it out," said Yeomans.

Estimating the cost of the underground exploration program at $5.5 million, Yeomans reported that Mimiska has been approached by several companies expressing an interest in a partnership.

Based in Val-d'Or, Que., Mimiska currently holds 100-per-cent interest in the properties.
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Title Annotation:Gold Mining Report
Author:McDougall, Douglas
Publication:Northern Ontario Business
Date:Jul 1, 1990
Previous Article:Giant Yellowknife 'doing well' in battle to reduce costs.
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