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Nevada firm wants to mine dredge tailings
A company from Elko, Nev., has been looking into reprocessing Sumpter Dredge tailings in hopes of recovering gold that the hulking machine left when it plied Sumpter Valley from 1913-54.
Ironside Mining Inc. recently sent a short report describing its plans to Baker County officials.
The company principals, Ed Netherton and Bill Steeves, want to "completely rework all Sumpter Dredge Tailings" because they believe only 40 percent of the gold was captured by the dredge.
"It would be nice to have the gold out," said Commissioner Carl Stiff.
"If there's one person that wants to do it there could be 15," said County Commission Chairman Fred Warner Jr. "We have to get ahead of the curve a little bit."
The county owns nearly 1,600 acres in the tailings, which are, in essence, piles of rock and gravel, interspersed with clumps of trees and ponds that are habitat for waterfowl and other species.
The federal government owns 100 acres in the tailings and about 450 acres are in private hands, according to Baker County.
The 2.5-million-pound dredge, which once operated around the clock, has been partially restored during the past 15 years and is the centerpiece of the Sumpter Dredge State Heritage Area at the south end of Sumpter.
The Heritage Area, 28 miles southwest of Baker City, attracts about 40,000 visitors per year.
The tailings extend from the dredge itself east for several miles to the edge of the Phillips Reservoir. The historic Sumpter Valley Railroad runs through the tailings between McEwen, near the reservoir, west to the Heritage Area.
Warner said he's interested in the potential for jobs and new revenue that Ironside's proposal brings.
But Warner also pointed out that the venture could have "a lot of planning issues" associated with it.
Ironside describes its process as a "semi-wet pit type" in which the tailings would be re-sorted with the coarse rock being placed primarily on the lower layers of tailings. The final top layer would be the original fine granular sand and soil.
This type of restructuring would result in level ground covered with fines and topsoil that could be farmed or used as pasture, according to the company.
"A major mining venture brings considerable benefits to a community," Ironside's report claims. "The project would start off small and ramp up over a period of three to four years to a full-blown commercial placer operation that would generate significant amounts of revenue for Baker County."
These revenues to the county could come as: gross royalty of all gold produced paid directly to the county, various company taxes and fees, new jobs and those related taxes, new service and material requirements, and various state taxes and fees, according to the company.
Ironside is asking county officials for a long-term lease in the tailings.
The company wants to start with a 100 TPH (tonnes per hour) pilot plant that would establish the grade of the remaining gold. That would expand to a larger operation that would process 400 TPH.
Expectation is that it would take up to nine months to obtain needed permits from the county, state and federal governments that would allow for completing two phases.
The first phase, which Ironside wants to do this spring, involves digging small test pits to determine whether there is a minimum ore grade of 0.4 grams per cubic yard.
The second phase would be completion of the pilot plant by early fall. It would operate until the end of 2013—during which time the process is evaluated.
The third and fourth phases would be creation of the first large plant by spring 2014, then eventual further expansion.
Ultimately, Ironside Mining wants to operate several plants in the area and reprocess tailings for the next 15 to 20 years.
No money would come to the county until the second phase is under way in 2013. Ironside estimates a 4 percent gross revenue royalty would bring the county $138,000 that year. That estimate is based on a gold concentration of 0.5 grams per cubic yard, a gold price of at least $1,600 per ounce, and a mining season of nine months.
If the gold concentration stays constant, the price remains at $1,600 an ounce and the mining season continues to be nine months long, the third phase could provide the county with $1.4 million annually. Two plants in the final stage could bring $2.5 million to $3 million in royalties annually to the county starting in 2015 or 2016, the report claims.
The price of gold per ounce was at $1,721 early today.