Our other exploration strategy includes the following concepts:
Exploration of Sulfide Ore in Mining Property
There are some indications that suggest the significant amount of sulfide ore buried underneath the oxidized ore. As already disclosed, the exploration activity, which was conducted in the January-March quarter, has produced favorable results. Since the permit for mining and processing sulfide ore in our areas have not been issued, we cannot launch mining operations immediately. For this reason, in-depth research has not been conducted at this point. However, with the substantial rise of gold prices, profitable mining is possible depend on the amount of sulfide ore and its grade
Realizing the whole picture through exploration is the first step to our grand-scale plan regarding sulfide ore mining operation. We expect that at least several million ounces of sulfide gold ore exist.
Mid-Area between the Two Gold Mines
The 6.5km area between Florida Canyon and Standard Mine remains almost unexplored, Apollo Gold, the previous owner, was fully occupied with starting up the operation of Standard Mine and barely conducted exploration survey on its surrounding areas, Likewise, Pegas Gold, the previous owner before Apollo Gold, focused on developing and operating only Florida Canyon,
The fact that the detailed survey has not been performed in the area between the two operating mines indicates that our properties have rare, favorable conditions, leading us to believe huge potential in the mid-area,
Sample of Initial Exploration Property; Barber Canyon
Currently, we are poised to undertake exploration drilling of Barber Canyon after advancing the initial exploration program. The outcome of the drilling will determine our decision on whether to continue further detailed exploration or waive loyalty on the mining area. We decided to perform drilling exploration at the prospect, hoping that this would allow us to confirm that the existence of deposits and mineralization.
Other Exploration Mining Areas and New Acquisition of Other Exploration Mining Areas at the Initial Stage
With the aim of acquiring mining areas of initial exploration, we conduct sampling survey on the surface of the mining areas, which are considered promising and where mining rights have not been established. If the existence of certain mineralization including gold and silver is confirmed or if there are indications that could contribute to such findings, then further research will be undertaken after mining rights are granted. The mining properties at this stage include Big Bomber and Nugget Fields.
After mining rights are obtained and if sampling and geochemical/geophysical exploration at the surface produce favorable results, there will be drilling exploration taken place. But, if the outcomes do not offer a promising outlook, then mining rights will be waived.
These concepts are capable of producing considerable economic benefit in the future. Our strategy is to prioritize “the exploration of large-scaled oxidized ore in our mining areas with the target of doubling the current reserve” and then implement & promote other concepts as needed. So far about 350,000 ounces or 109 tons of gold have been mined at Florida Canyon and Standard Mine. Suppose 3 million ounces or 93 tons of gold is confirmed from the exploration of oxidized ore, the total amount of gold will increase up to 6.5 million ounces or 202 tons. Moreover, if we can add the ore of the mid-area between the two mines and sulfide ore below the oxidized ore, there is no denying that our mines grow into one of the world-class mines.
Our exploration concept consists of two parts; one is a project which transforms our mining areas into world-class mines that yield stable gold production over long period and the other involves an activity designed to find mining areas with the potential to develop into our second operational mines.
Jipangu currently owns two gold mines, namely Florida Canyon and Standard Mine., to produce gold in Nevada and the US,
Jipangu’s Two Gold Mines
|Name of Gold Mine||Reserve||Resource|
|Florida Canyon||832,00 ounces||746,700 ounces|
|Standard Mine||292,00 ounces||14,300 ounces|
|Total||1,124,800 ounces||761,000 ounces|
1. Reserve: Amount of economically minable gold at the nominal gold price
2. Amount of gold ore in the crust
Approximately 3.5 million ounces of gold has been mined at Florida Canyon and Standard Mine. Given the amounts of ore at the mid area between the two mines, combined with the potential amounts of sulfide ores, our gold mines will join the world’s class gold mines.
Florida Canyon is about 68 kilometers southwest of Winnemucca, northeast of the State of Nevada. For the past 25 years, this open pit mine has produced 3.3 million ounces of gold, of which 2 million ounces has already been recovered.
Currently, mining at Florida Canyon has been terminated, but gold recovery from loaded ores is ongoing (with 20,900 ounces planned to be produced in 2011). The permit for the leach pad expansion is required in order to restart mining operations. It is expected to be issued by the first quarter (January to March) of 2014. To meet this end, we are working steadily on necessary procedures such as the environment assessment and the formulation of reclamation planning.
Standard Mine, an open pit mine, is approximately 8 kilometers south from Florida Canyon with about 290,000 ounces of gold reserve.
With the leach pad expansion scheduled in the first half of 2011, Standard Mine will have a capacity to load the whole ore which will be mined by the first half of 2014. We are working steadily on the operation.