Newmont explores mine's potential.

Newmont Mining is examining its options to make full use of its recently acquired milling facility in northeastern Ontario.

Since acquiring a 3,000-tonne-per-day processing plant from Barrick Gold as part of a $4-million purchase of the Holt-McDermott mine, the world's largest gold producer is finalizing plans to begin underground exploration in 2005 to find more reserves and bring the plant to full production.

The mine and mill, located 48 kilometres northeast of Kirkland Lake, became expendable to Barrick Gold when reserves were believed to be exhausted.

Newmont, owners of the nearby Holloway gold mine, about 1.5 kilometres away, held a custom milling agreement with Barrick to process their ore.

When Barrick made the announcement earlier this year to close Holt-McDermott, Newmont held first right of refusal to purchase the facility, which they officially took possession of in early October.

Both mines each contributed about 1,500 tonnes per day to keep the mill running at full capacity.

Currently, the processor is running at only 50 per cent with Holloway's production.

"Obviously, we've got room to grow," says Holloway mine manager Luc Guimond, who has retained 25 of Holt-McDermott's 180-employees to run the mill and boost Holloway's workforce to 167.

Guimond says the company may fill that milling gap by arranging other custom-feed arrangements with other successful mining companies or possibly finding additional reserves if an upcoming underground exploration program proves successful.

The now-closed Holt-Dermott mine will be placed on a care and maintenance program while the company evaluates its options, says Guimond.

"The exploration market is pretty good and there's a lot of activity. There are juniors (exploration companies) in the area and from the success they may have, they may need milling capacity as opposed to trying to take on construction their own mill."

The company is finalizing a budget and exploration program with the corporate office for underground development and diamond drill work from both the Holloway and Holt-McDermott headframes.

"If we're able to follow up on targets and find potential reserves, we may re-open the underground."

With an extensive land package that runs a 50-kilometre corridor from Matheson to the Quebec border, the company is also considering doing some undisclosed development work. The re-activation of the mill remains good economic news for the area.

www.newmontmining.com

By IAN ROSS 

Northern Ontario Business