Trash to Treasure: Tailings deliver 4g/t gold for Sierra Nevada Gold

• SNX reports up to 4.09g/t gold from historic tailings dams at New Pass project, Nevada
• Company advancing processing options for the tailings
• Aim is to reprocess tailings for revenue in the near term

Special Report: Sierra Nevada Gold has returned high-grade gold from sampling at four historic tailings dams at its New Pass project in Nevada, USA.

It opens the window for Sierra Nevada Gold (ASX:SNX) to tap into a new and potentially lucrative revenue stream as it looks to bring the operation back to production in an increasingly bullish environment for both gold and US mining.

The historical New Pass mining centre has a long and varied history dating back to its discovery in the 1860s.

It produced gold intermittently at a reported average recovered grade of 17g/t gold from two parallel, steeply dipping north-south striking quartz veins – the eastern Superior Vein and the western Thomas W Vein – until 2012.

Tailings from mining of that vintage typically contain grades that weren’t economic in the good ol’ days, but very much are now, with gold prices upwards of US$3300/oz.

Mining from tailings also carries minimal production costs, making the technique a handy kicker to cheaply boost production.

Last month, the company completed a shallow 66-hole auger drilling program focusing on dams 1-3 (with dam 4 receiving only preliminary testing) for a best result of 4.09g/t gold.

Individual dams averaged grades of 1.87g/t (Tailings Dam 1), 1.05g/t (Tailings Dam 2), 1.51g/t (Tailings Dam 3), and 0.96g/t (Tailings Dam 4) for an average gold grade of 1.55g/t from 113 samples across all the dams.

While auger drilling only reached 2m depth, the dams generally exceed this, with Tailings Dam 1 estimated to be up to 4m in depth based on historical information – which SNX says provides the potential for further mineralised tailings at depth.

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Revenue from reprocessing historic tailings

The company also noted that higher grade gold was often returned from a coarser +1cm fraction, indicating insufficient historical grinding.

The plan now is to investigate dams 1 and 3, which present compelling targets for future processing to extract the residual and unrecovered gold.

“The initial auger sampling assays of the tailings at New Pass are encouraging, as we continue with plans to conduct a bulk ore sampling program on the high-grade veins to test the potential for re-establishing gold production at the New Pass mine,” SNX executive chairman Peter Moore said.

“Reprocessing the tailings has potential to generate revenue in conjunction with the planned trial mining and bulk testing program.

“New Pass mining centre historically produced gold at an average grade of 17g/t gold, so we were confident the residual tailings would yield good grades that provide further evidence of historic high-grade gold production.”

Alongside this, SNX is progressing underground mining options for the currently accessible high-grade ore within the Superior Mine.

“The Superior Vein at New Pass returned 1.22m at 26.7g/t gold from 186.53m in our exploratory drilling and is the focus for the planned bulk testing program plans and re-establishment of small-scale mining operations at New Pass,” Moore said.

Permitting to allow for the re-opening of the Superior Mine is underway.

This article was developed in collaboration with Sierra Nevada Gold, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.