GREY:VMSTF - Post by User
Post by
freeedom45on Apr 24, 2011 12:58pm
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Post# 18479742
Reed Lake - Perfect Timing & Fit
Reed Lake - Perfect Timing & FitReed Lake - “Perfect Timing & Fit” for HudBay Minerals
The following is the 2011 Production Guidance from HudBay Minerals for their operating mines in the Flin Flon - Snow Lake VMS belt.
| 2011 Production Guidance | | 777 | Trout Lake | Chisel North |
| Ore Mined | Tonnes | 1,490,000 | 450,000 | 260,000 |
| Grades | | | | |
| Zinc | % | 4.2 | 2.8 | 6.1 |
| Copper | % | 2.8 | 1.8 | 0.5 |
| Gold | g/t | 2.0 | - | - |
| Silver | g/t | 27.9 | - | - |
| Unit Operating Costs | C$/tonne | $37-41 | $70-86 | $80-100 |
The operating costs at Trout Lake and Chisel North are increasing as both mines are nearing completion. As a result of decreased production from Trout Lake, operating costs at the Flin Flon concentrator are also increasing. Hudbay expects to close the Trout Lake mine at the end of 2011.
With HudBay needing to replace production from Trout Lake, the “timing” for a mine at Reed Lake couldn’t be better. With high grade mineralization starting within 30m from surface, 150m from paved provincial highway #39, a 1 hour drive to the Flin Flon concentrator, Reed Lake could be in production in short order. A decline ramp will allow access to the high grade ore and full production could begin as early as Q3 - Q4 2012. Based on a 1250 - 1500 tonne per day operation; annual production could look as follows:
| Potential Annual Production | | Reed Lake |
| Ore Mined | Tonnes | 450,000 |
| Grades | | |
| Zinc | % | .91 |
| Copper | % | 4.52 |
| Gold | g/t | .64 |
| Silver | g/t | 7.86 |
| Unit Operating Costs (estimated) | C$/tonne | $54-64 |
Note: Grades were taken from NI 43-101 Mineral Resource Estimate released Apr.1/11.
: Grades were taken from NI 43-101 Mineral Resource Estimate released Apr.1/11.
Comparing the Rock
Total Gross Metal Value per Tonne
(based on current metal prices - April 24, 2011)
777 - $508.27
Trout Lake - $239.86
Chisel North - $192.18
Reed Lake - $500.75
(The gross metal value is for comparison purposes only.)
It looks, in my opinion, that the ore from Reed Lake would be more than a welcome “fit” to HudBay’s operations in Flin Flon, MB. The ore from Reed Lake could be as much as 100% more valuable than current ore from Trout Lake.
The initial resource estimate at Reed Lake (2.55 Million Tonnes @ 4.52% Copper in the Indicated Category) will likely prove conservative as time goes on. Other mineral deposits in the Flin Flon - Snow Lake VMS belt have been known to grow substantially from their initial resource estimate. Trout Lake for example, had an initial resource estimate of 2 - 3 million tonnes and to date over 20 million tonnes have been mined!While HudBay continues drilling at Reed Lake and drill testing 14 high priority targets on the four additional option agreements in place, VMS is aggressively working on their substantial 100% owned properties in the Flin Flon / Snow Lake belt. Two of VMS’s 100% owned properties are already showing promise, with a gold discovery at Sails Lake and a high grade copper discovery at Cowan River.
With all the ongoing activity, the blue sky potential for VMS Ventures has never been greater!
Good luck to all,
freeedom45
: Grades were taken from NI 43-101 Mineral Resource Estimate released Apr.1/11.