Sierra Nevada Gold acquires historical New Pass mine to fast-track production restart
Sierra Nevada Gold (ASX: SNX) will pay US$250,000 to acquire the historical New Pass gold mine in the US, extinguishing the previous long-term lease and purchase option agreement and attaching a royalty over 12 claims.
The company will make five annual payments of US$50,000 each to assume full title of the existing underground mine, mining infrastructure, property and on-site stockpiles.
Ownership will allow Sierra to expedite its evaluation of several trial mining proposals for bulk sampling of the Superior and Thomas W high-grade veins, with a view to re-starting production.
Development plan
The company’s work program will commence with initial testing of the Superior vein to confirm ore body grades and establish a development plan for the mine.
New Pass closed in 2012 after intermittent production at a reported average grade of 17 grams per tonne gold.
Sierra Nevada drilled a confirmatory reverse circulation hole in 2022 to establish continuity down-dip below the existing stoping at Superior and intersected 1.22 metres at 26.7g/t gold from 186.53m.
Positive step
Executive chair Peter Moore said the acquisition would be a positive step for the company.
“Our preliminary work and detailed underground surveys in recent years have indicated that the mine has the potential to re-open and we look forward to expediting its evaluation over the coming months,” he said.
Mr Moore said the company had commissioned geotechnical consultant Call & Nicholas to perform a preliminary assessment of the ground conditions within the various mines at New Pass to inform initial development planning.
Ground assessment
Sierra Nevada has also commissioned Light Detection and Ranging (LiDAR) surveying of accessible workings, creating 3D solids of the current accessible development and stopes to inform optimal drilling campaigns.
Underground mapping and past sampling of remnant mineralisation at the Superior Level 4 adit returned numerous high-grade assays, including 20.1g/t gold and 16.95g/t gold from remnant exposed ore.
The company expects all necessary permits to be in place within six months to enable commencement of an underground drilling and bulk sampling program.