Pure Gold revives a past producer in the Red Lake camp: Mine developer aiming for commercial production at Madsen Mine project in 2020.

• Author: Kelly, Lindsay
• Position: NEWS

Six years ago, as board members at Pure Gold Mining were going through a checklist spelling out the ideal attributes of a potential exploration property, they quickly realized the past-producing Red Lake Madsen Mine had it all.

"We wanted to be in a good, stable jurisdiction, we wanted a project that was high-grade, and we wanted access to infrastructure," said Darin Labrenz, president, CEO and director at Pure Gold. "So, something that we could not only explore, but ultimately build."

In operation between 1938 and 1974, Madsen is the second largest producer in the Red Lake camp, consecutively producing 2.5 million ounces of gold over 36 years.

But Pure Gold believes the property hasn't received the exploration attention it deserves, and over the last few years the company has undertaken extensive drilling, making several discoveries that Labrenz said have "really, really opened up the project."

What sets the property apart is its unique geology, Labrenz said.

"We're in the right rocks, we've got the right structure, but geologically, it was seen as a little bit different than (Newmont Goldcorp's) Red Lake Mine," he said. "It's a different metamorphic grade, so it's effectively been cooked up, and some of the obvious characteristics you don't see at Madsen."

In total, Madsen has an indicated mineral resource of 2.063 million ounces of gold, and an inferred mineral resource 467,000 ounces of gold.

That includes figures from a preliminary economic assessment (PEA), filed in February, for three satellite areas--Fork, Russet South and Wedge--which added 3.7 years of mine life and $51 million in after-tax net present value to the project.

Pure Gold is proposing an underground operation with a 12-year mine life and processing of 800 tonnes per day.

"I think it really speaks to the upside when you consider that our first drill hole was 14 months ago," said Labrenz, who became familiar with the Red Lake camp during his 15-year tenure with then-Placer Dome, where he served as chief geologist at the Campbell Red Lake Mine.

"With additional drilling, we've defined it down to 500 metres, we've put out a resource earlier this year, which is a first-time disclosure resources in that area, and now we've captured it in a preliminary economic assessment.

"So a very rapid transition from a first drill hole to an economic study, and it's right at surface, which is pretty remarkable."

Pure Gold is also continuing...