Profitable aggregate sideline adds to bottom line for gold miner Anaconda

Junior gold producer Anaconda Mining is getting noticed for all the right reasons. The company opened a small gold mine 6 km east of Baie Verte on Newfoundland’s Ming’s Bight Peninsula in 2008. It is called the Point Rousse project and includes the Pine Cove gold mine and the 1,200-tonne-per-day mill.

The Point Rousse project is a small, reliable operation pouring slightly more than 16,000 oz. in 2016 with plans to double production to 30,000 oz. in the works. There is potential for expansion and longer life as Anaconda continues to explore five additional deposits and several showings within 8 km of the mill.

Anaconda’s Point Rousse ship loading facility for aggregates headed to the United States. (Credit: Anaconda Gold)

Recognition is coming quickly. The CIM Newfoundland Branch named Anaconda the 2016 Miner of the Year. The company is one of the best places to work in Atlantic Canada, as rated by Progress Magazine and Best Companies Group last year. The company’s president and CEO Dustin Angelo was named to the list of 2016’s Top 50 CEO’s in the region by Atlantic Business Magazine. And earlier this year Angelo was named Industry Person of the Year by Natural Resources Magazine.

Besides building an award winning gold enterprise, Angelo has also created a thriving aggregate ventures for the company. It is located at the Point Rousse port facility where crushed waste from the mine is loaded onto ocean-going vessels.

Anaconda is working with Shore Line Aggregates (a subsidiary of its contract miner, Guy J. Bailey Ltd.) and Phoenix Bulk Carriers to supply 3.5 million tonnes of gravel to a construction project on the eastern seaboard of the United States. The final environmental and construction permits for the port were received last December.

Point Rousse is located in the Baie Verte Harbour, one of the deepest harbours in Atlantic Canada. The depth makes the site suitable for loading ships up to 199 metres long and carrying 60,000 tonnes per trip. So far Anaconda has shipped about 1 million tonnes of aggregates.

The aggregate contract will add approximately $2 million to Anaconda’s treasury by the end of this year, and that is without having to commit capital to the project.

“With water export access at Port Rousse, our waste rock is now a competitive product in the seaborne aggregates market, resulting in an additional revenue stream for Anaconda while also reducing mining costs, Angelo said in a release. “The aggregate that will be shipped under this project would otherwise require approximately 100,000 tri-axle tractor trailer loads if transported over land. The marine shipping option makes this a safe, green, and competitive means to move vast amounts of product.

“The establishment of Port Rousse also opens up new economic diversification opportunities for Anaconda and the Baie Verte region. Water access now positions Anaconda to explore other export and import ventures, including potentially importing gold ore for processing at the Pine Cove mill,” he added.

The aggregate business created more than 70 new jobs, 60 at Shore Line and 12 more at Sealand Shipping Services as tug operators, harbour pilots, and hand-lining services. Vessels are loaded continuously at a rate of about 20,000 tonnes per day.

Anaconda’s gold prospects, too, are good. The Pine Cove deposit has probable reserves of 858,855 tonnes grading 1.46 g/t gold, indicated resources of 1.5 million tonnes at 1.61 g/t, and inferred resources of 220,700 tonnes at 1.59 g/t gold (0.7 g/t cut-off). All in there are almost 125,000 contained ounces of gold.

Also within the Point Rousse project is the Stog’er Tight deposit, which is in an advanced stage of exploration merely 3 km east of the Pine Cove mill. This mineralization totals 204,100 indicated tonnes grading 3.49 g/t gold and containing 23,540 oz. as well as 252,000 inferred tonnes at 3.27 g/t gold and containing 26,460 oz. (0.8 g/t cut-off).

The company optioned the Viking gold project from Spruce Ridge Resources in February 2016. The property is 100 km away by water or 180 km away by road from the Pine Cove mill. Resources there have been calculated at 937,000 indicated tonnes grading 2.09 g/t gold and 350,000 inferred tonnes grading 1.79 g/t (1.0 g/t cut-off). Together the contained gold totals 53,000 oz.