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Another Homestake?

Canadian company acquires 289 mineral rights near Rochford, making plans for exploration

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Posted: Wednesday, February 20, 2013 11:30 am

LEAD — There is still gold in these hills, and a Canadian-based mining company hopes to capitalize on it with what could be a large-scale underground mining project, similar to the former Homestake gold mine, near Rochford. 

Mineral Mountain Resources, Ltd., a mining company based in British Columbia, recently acquired 289 mineral rights in the Rochford Mining District. The rights are located about 20 miles south and southeast of the former Homestake Gold Mine, and encompass about 4,500 acres of land. 

The company is the same one that has been doing exploratory drilling for gold on 5,000 acres near Keystone, for the last five months, in what has been called the Holy Terror Project. Brad Baker, vice president of corporate development and director with Mineral Mountain Resources, Ltd., said the company has had very favorable results of high-quality gold deposits near Keystone and has very high hopes for the Rochford area. 

“The ultimate goal is to discover another Homestake-like gold deposit,” Baker said. “That was one of the most successful in the western hemisphere. Right now all indications are that there may be potential for an economic underground mine in the area for several economic deposits.”

“In many ways, we compare the Homestake Gold Trend to the Timmins gold camp before modern exploration methods were used,” said Nelson Baker, president and CEO of Mineral Mountain Resources, Ltd. “We were surprised to find that the Black Hills uplift, in particular the Homestake Gold Trend, where gold mineralization is controlled by iron formation and complex structures, was never systematically flown magnetically and electromagnetically. We were also excited to find that both the Rochford and Keystone Mining Districts had not been seriously explored for nearly two decades.”

Having just acquired the local mineral rights, Baker said his company’s first move will be to do an airborne magnetic survey of the 4,500 acres. The airborne surveys help to pick up certain geological features, such as iron formations that are associated with the gold in the area. The newly-acquired claim package straddles what the company believes to be the highest density of gold occurrences controlled by iron formation and complex structures in the Rochford Mining District. 

“Iron stands out very well when you fly an airborne survey, and there has never been an airborne survey, to our knowledge, conducted in this area,” Baker said. 

Baker said the company expects to find large gold deposits that would warrant development of another underground gold mine in this area. The only question, following confirmation of this theory after employing several exploratory techniques, is whether Mineral Mountain Resources, Ltd. will put the gold into production, or whether another major gold producing company will do it. But, Baker said, those are all decisions that will be determined four or five years from now. Currently, officials at Mineral Mountain Resources, Ltd. are working on mobilizing near Rochford. 

Though right now, Baker said, there is no widespread need for local employees, as the company has hired a drilling contractor and in-house geologists, to explore, there could be a great local economic impact in the future. For activity in Keystone, he said his company has committed to spend $20 million over the next four years, and has also contracted with the town of Keystone for a water supply. Mineral Mountain Resources Ltd. has not yet established its budget for the Rochford project. 

“We think we could have a financial impact for the citizens in the area,” Baker said. 

He also said this is the first time since the 1980s or early 1990s that detailed exploratory drilling has occurred in the Black Hills for a non-established gold mine. 

“We think the area has tremendous potential,” he said. “But it’s going to take a lot of money and a lot of time to uncover that potential.” 

Baker said Mineral Mountain Resources Ltd., plans to be working in the Rochford area for at least the next 10 years. 

Even if the anticipated underground gold mine doesn’t turn into another Homestake Gold Mine, Baker said his company would be very pleased to get at least a couple million ounces of gold. Over the course of its more than 125-year history, the Homestake Mining Company produced more than 40 million ounces of gold. However, Baker said Mineral Mountain does not envision an open-pit mining operation, similar to how Homestake started. 

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1 comment:

  • Miner posted at 7:43 pm on Fri, Feb 22, 2013.

    Miner Posts: 94

    And in a related story, shares of Mineral Mountain Resources are trading at .21 cents. With 112 million shares issued and outstanding, 38 million more in warrents and an additional 7 million under option, the second "Homestake" has a market capitalization of....... drum roll......... $33 million!