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New Australian owners look to get White River mine back on track

Silver Lake Resources poised to pour millions into efficiencies at Sugar Zone Mine
Harte Gold Sugar Zone mine face
(Harte Gold photo)

The new Australian owners of a once-insolvent White River gold mine intend to install the latest and greatest in modern mining systems.

Silver Lake Resources plans to spend between $35 million and $45 million (Australian dollars) over the next two years to get the struggling Sugar Zone Mine operating at a productive and profitable level.

In its July 27 quarterly report, the South Perth-headquartered gold company said after closing the deal to acquire the mine and property from Harte Gold in Feb. 18, it initiated a “holistic review” of the operation.

The plan forward is simply to put better systems and practices in place starting in the second half of this year.

Among the upcoming improvements will be replacing an antiquated mining fleet with new teleremote systems, such new front end loaders, which can be operated from the surface. Some of new equipment has already arrived at the site in the form of a Sandvik LHD307 loader, part of the $1.8 million spent at White River in the quarter.

Older pneumatic longhole drill rigs are being swapped out for modern electro-hydraulic rigs.

The mine has been redesigned, the company said, by eliminating one of two declines to access the main Sugar Zone deposit. A costly processing “bottleneck” will be addressed with the installation of a higher capacity crushing circuit.

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The company said it eventually wants to boost mining rates from 800 tonnes per day to 1,000, which will happen once the new mining fleet arrives and when they have the permit to do so.

About $27 million will be spent on new equipment over the next two years with $9 million spent on surface infrastructure, such as converting the crushing facility into a maintenance workshop and parts warehouse.

Sugar Zone is 30 kilometres north of the town of White River, about halfway between Sault Ste. Marie and Thunder Bay.

Quarterly gold production - the first full one under the Silver Lake flag - was 11,636 ounces, up from the 9,992 ounces produced during the last quarter.

The company mentioned it’s giving serious thought to relocating its accommodations camp located in the community of White River. They want to eliminate the 50-minute commute time by bus from the town to the mine. The earliest that could happen would be in the summer of 2024.

Along with the mine, Silver Lake inherits a huge 81,287-hectare property that’s largely untapped.

Exploration spending will be a “core focus,” the company said.

The area within and around the Sugar Zone Mine holds significant gold potential that had been “inadequately” drilled. There are gold resources to be proved up and mineralized extensions to be followed both laterally and deeper down.

A new geological model is being put together that involves a $7-million, 67,000-metre infill drilling program to find more discoveries along a three-kilometre mine trend.

Further out on the property, Silver Lake will be devising a regional exploration of drilling, geophysics, geochemistry, mapping and geological reconnaissance. The initial focus will be to put together a database and come up with a list of exploration targets.