Large Operator's Approach to Wall Operator's Heap Leach Properties

INTRODUCTION The finding or acquisition of ore bodies containing 200,000 opt gold and greater is becoming more difficult. There are more investors and small heap leach operators who have or can raise the capital to make the investments in the large ore bodies. Echo Bay Mines' approach has been to regionally develop small ore bodies, two or three in the same geographic location, which when considered together contain over 200,000 opt gold. CONCEPT The "world class" ore body syndrome, which many large gold producing companies maintain, can restrict company growth if the finding or acquisition of these large ore bodies is not forthcoming. Another approach has been taken by Echo Bay Mines. The concept is to regionally develop two or three small ore bodies suitable for processing with portable equipment. The systematic scheduling of mining, processing with a single flexible processing plant using the same management/ operator team can reduce your overall investment. The initial selection of mining and crushing equipment suitable for sun11 open pit operations is essential. A very viable option in the mining sequence is to use contract mining/crushing/screening/agglomerating and stacking. This option also lowers your initial capital investment and increases the flexibility in mining as you move from one mining operation to another. LOCATION AND SEQUENCING One single small ore body of itself is not attractive enough for the large producer. The recovery of the initial capital investment, although very rapid, does not make a viable project. The only alternative is to find two or more small ore bodies close enough geographically to each other so that the same management/operator team can be used to run the operations as each is put into operation. Echo Bay Mines has regionally located several ore bodies ranging in recoverable ounces up to 100,000 oz. These small separate ore bodies, located within a 30-mile radius of each other, for planning purposes have been considered as one single ore body. The first small ore body has the initial burden to recover the capital invested in the office, laboratory, power plant and processing plant. Other capital investments such as water supply, access and haul road, fencing, septic system, pads and ponds are reoccurring at each mine site. The first small ore body must recover the initial capital investment in the movable structures as well as the reoccurring capital investment in the fixed structures very rapidly. A total capital recovery time of 6 to 9 months should be used as an economic decision point for both choosing which small ore body should be processed first, and what the plant design capability should be. The sequencing of the small mines is very critical. All the fixed structures mentioned above must be installed at the second mine site before the first mine has been mined out. The ideal sequencing will allow for only one month between shutdown of the first small mine and production from the second. SPECIFIC OPERATION Echo Bay Mines has completed the construction of the Illipah Mine located in White Pine County, Nevada, with this small mine sequence approach. The Illipah Mine is a 40,000 ounce recoverable gold ore body. This ore body met all the necessary requirements. The Illipah project could support the capital investment in the movable structures which will