VANCOUVER (miningweekly.com) – Eastern Canadian gold producer Anaconda Mining is set to ramp up the mining rate at its Point Rousse project’s Pine Cove pit, after the Newfoundland and Labrador Department of Natural Resources approved a plan to use the nearly depleted pit as a tailings storage facility.

Anaconda had previously filed an application with the department to amend the Pine Cove property development plan and rehabilitation and closure plan to utilise the Pine Cove pit as a seven-million-tonne in-pit tailings storage facility.

"The addition of the in-pit tailings facility strengthens our infrastructure at the Point Rousse project and fortifies our platform to support our growth initiatives in Atlantic Canada. Anaconda has generated over C$140-million in revenue from the Pine Cove deposit and now the potential tailings capacity will continue to generate significant financial and strategic value,” president and CEO Dustin Angelo stated in a press release.

He noted that given the high cost and permitting hurdles of constructed tailings facilities, the Pine Cove pit is a “tremendous, low cost asset”.

At the current rate of mineral processing, the pit provides Anaconda with tailings storage capacity of about 15 years. “A long life, in-pit tailings storage facility is the perfect complement to our 1 300 t/d mill and deep water port,” Angelo added.

Unlike tailing facilities with engineered walls, in the case of an in-pit tailings facility, there are less technical and environmental risks than in conventional, constructed facilities. Besides, based on its review of recent tailings construction projects in Canada, Anaconda estimates that the cost of storing tailings can range from C$5/t to C$10/t of tailings, depending on geography and geology, as well as the chemistry of the tailings themselves.

Therefore, Anaconda estimates it is saving about C$35-million to C$70-million in capital expenditures related to tailings storage based on seven-million tonnes of capacity in the Pine Cove pit.

As the Pine Cove pit transitions to a tailings storage facility, the company will continue to mine the Pine Cove deposit in areas next to the pit. Anaconda also plans to develop the Stog'er Tight deposit, which is about 3.5 km from the Pine Cove mill, in the fall, and to start mining in early 2018.

Over the next two years, Anaconda expects to mine and process ore from Pine Cove and Stog'er Tight. On a longer-term basis, Anaconda is focused on outlining a mineral resource at the Argyle discovery, about 4.5 km from its mill at the Point Rousse project, and developing the high-grade Goldboro project, in Nova Scotia.

During fiscal 2017, Anaconda achieved gold sales of 15 562 oz, and it has guided for gold output of 15 500 oz for fiscal 2018.