CANADIAN firm Tournigan Gold Corporation is planning geological surveys that it hopes will lead to the reopening of Kremnica gold mines after acquiring Slovak mining company Kremnica Gold.
The Vancouver-based firm acquired the company from another Canadian company, Argosy Minerals, for CAD 500,000 (€325,000) in July this year.
Through the Kremnica Gold acquisition, Tournigan has obtained a project containing over one million ounces of gold, based around the town of Kremnica in central Slovakia.
The Slovak Geological Survey began investigations into a potential open pit deposit around Kremnica during the 1960s. Argosy began drilling in the area in 1996 to define the limits of the mineral resources available, discovering new sources to the north and south of the original find.
An independent estimate in 1998 evaluated the find to be 15.6 million tonnes at an average grade of 1.91 grams/tonne of gold and 15.0 grams/tonne of silver, and 22.3 million tonnes at an average grade of 1.54 grams/tonne of gold and 12.5 grams/tonne of silver at a 0.5 grams/tonne cut-off.
The Tournigan management also believes that there may be further minerals at even higher densities, with up to 5 million ounces of gold, in adjacent areas covered by the Kremnica Gold licence.
The last gold mines in the area closed down in 1971 after more than 600 years of production, extracting a total of 1.5 million ounces of gold and 6.7 million ounces of silver. Indirect evidence suggests that gold and silver mining in the area may date back as far as the 7th century BC.
The mineral deposits in the area made Kremnica a good site for the national mint, which has been producing coins since 1328. It continues to produce coins and medals to the present day, including Slovak currency and those of other countries, including India, Cuba, and Sudan.
Tournigan chairman Hein Poulus told journalists on August 18 that the company was looking for further co-investors to exploit the deposits.
Kremnica Gold representative Boris Bartalský told The Slovak Spectator: "Tournigan could also invite another mining company to assist us in exploring, constructing and producing gold at Kremnica. The company is open to any investors, including Slovak companies."
The company expects the initial research phase to last three years or more, but it expects to be able to begin mining earlier.
"The exploration phase may take three years or even longer. However, Tournigan may begin the production phase before exploration is fully completed. For instance, the Sturec zone could be mined while we are exploring the Wolf zone," said Bartalský.
However, before construction of the mine can start, the company will have to receive approvals from government agencies, which could take between 12 and 18 months. Kremnica Gold estimates that the construction itself will take a further year.
Tournigan did not specify whether it would be surface or pit mining, but assured the public that environmental concerns would be considered.
"We will mine ecologically, or not at all," said Poulus.
Bartalský emphasised that the need for ecological mining is based not only on the company precepts, but also on practical needs.
"The mining industry has been very successful in improving techniques to help protect the environment. A big factor is that banks that provide financing for mining projects do not want to be involved with projects that pollute or create any environmental problems. It is impossible to start mining without complying with the Environmental Impact Assessment law. The project should meet all Slovak environmental standards which are now in compliance with EU environmental legislation," he explained.
"Modern mining and treatment operations reduce pollution to a minimum. All possible negative effects are now carefully contained by extensive research before the mining takes place and by closed-loop processes (e.g. water recycling) once production begins. Ground contamination is controlled by safety systems that reduce accidents, along with technology to make the process pollution-free," added Bartalský.
Poulus would not speculate as to the level of investment needed for the mining phase of the project, nor how many local jobs could be created.
Poulus explained that uncertainty as to the size of the deposit and the future level of gold prices invalidated such conjecture.
"In the case that the [world gold price] falls below US$ 200 (€180) an ounce, the mine would not be profitable," he said.
The current price of gold is expected to remain above US$320 (€287) into 2004, according to the Financial Forecast Center.
2. Sep 2003 at 0:00 | Conrad Toft