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Yukon Nevada Gold Corp > Jerritt Canyon pours gold, again

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Post by talkswitch on Oct 19, 2009 10:56am

Jerritt Canyon pours gold, again

By ADELLA HARDING - Mining Quarterly Editor

Published: Sunday, October 18, 2009 9:29 PM CDT

ELKO— Yukon-Nevada Gold Corp. subsidiary Queenstake Resources today pouredits first bar of gold in four and a half months at the Jerritt Canyonmill north of Elko while preparing to restart the mill’s roasters.

“We’rewarming up the roasters as we speak,” Yukon-Nevada Chief OperatingOfficer Graham Dickson said as he awaited the gold pour using materialthat had been processed before the shut down at the end of May andgathered during clean-up work.

“It’s been a long time coming,”Scott Alcorn, the operations superintendent, said after viewing thegold pour that netted a bar weighing almost 537 ounces.

At agold price of $1,050 per ounce, the bar is worth $563,850 dollars. Theprice has been in the neighborhood of $1,050 in recent days.

Dicksonsaid crews started the roasters after learning Thursday that ElkoDistrict Court Judge Andrew Puccinelli signed the consent decreeQueenstake and the Nevada Division of Environmental Protection hadalready signed allowing Jerritt Canyon to begin operations again.

NDEPhad allowed Queenstake to restart the mill last spring but ordered themill shut down again after the company missed a May 30 deadline toinstall new mercury air emission controls.

Dickson saidYukon-Nevada plans to produce roughly 150,000 ounces of gold in thefirst full year of production at Jerritt Canyon once the mill reachessteady-state operations to produce gold from stockpiles and beginsunderground mining again at the Smith and SSX mines.

“We hope to have Smith up before Christmas and SSX in the new year,” Dickson said.

Yukon-Nevadacurrently has 104 employees at Jerritt Canyon and four of them arerehabilitating the underground mines in preparation for the resumptionof mining, he said. The others have been working on repairs and gettingthe mill ready to go and on environmental tasks.

“We’ve been trying to get things done properly instead of patching up,” Dickson said.

Hesaid the roasters will take five to six days to heat up, and then themill will begin processing the ore from the stockpiles that containroughly 100,000 ounces of gold.

The return to production willbring in cash to repay creditors and complete severance and medicalpayments to former employees, Dickson said.

News that operationsare resuming also has boosted Yukon-Nevada share prices that were 2cents this time last year and are now at 34 cents, he said.

Thecompany laid off 400 employees when it shut down the mine in August2008, and the employees received only half of their severance, and anumber of them still have outstanding medical bills from the time whenQueenstake insurance benefits covered their care.

Under theconsent decree, Queenstake agreed to pay a $550,000 settlement to NDEPover past environmental issues, as well as agreeing to comply withenvironmental regulations and installing the mercury air emissionsequipment to meet NDEP requirements. The controls were installed July20.

The equipment is designed to reduce mercury air emissions toroughly 175 pounds per year from an estimated 1,700 pounds reported in2007, according to NDEP.

Meanwhile, Yukon-Nevada is hoping toraise more money to support the startup by inducing those with privateplacements that closed in December 2008 to exercise their warrantsearly.

“The warrants are attached to private placements. We’reasking everyone to exercise their warrants early,” spokeswoman NicoleSanches said Friday.

The private placement includes 172.4million warrants, with a portion exercisible at 7 cents per share andanother portion at 9 cents per share.

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Comment by talkswitch on Oct 19, 2009 11:06am

one gold pour is enough to pay NEDP penalty. no bad.Although not a qualified CEO, Mr. Dickson is better than MYNG people running the mill. however, with 800 million share fully diluted, yng's capx is already 300 Million at 0.4$ sp.

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