Armed with a couple of positive
reports from consulting firms, Reno's
Golden Phoenix Minerals continues its
search for the capital it needs to develop
its Mineral Ridge gold mine in
Esmeralda County.
President Michael Fitzsimonds said
last week the company needs about $2.8
million $800,000 for the reclamation
bond that state and federal authorities
require and $2 million in working capital
to begin mining operations.
He said the company is working
with lenders to meet the capital
requirements.
Fitzsimonds said, too, the company
appears to be near clearing the other
major hurdle it faces on the Mineral
Ridge property approval of its reclamation
plan by state and federal officials.
The mining company president said
he expects the approval of regulators and
bankers soon.
The company has been frustrated in
the past, however. In the company's
most recent annual report, Fitzsimonds
told shareholders that the company initially
expected to begin production at
Mineral Ridge in early 2001 after
Golden Phoenix purchased the mine in
late 2000.
"We did not take into account the
difficulty in obtaining the myriad of
permits and the regulatory requirements
that had to be met in order to go into
gold production," he wrote.
But the company now says the delays
may have been a blessing in disguise
because its employees better understand
the mine and its challenges.
Golden Phoenix officials have said
the Mineral Ridge property involves
four parcels with the potential to be
economically mined. The property,
which would be mined in an open pit,
covers about 4.2 square miles.
Estimates have placed the gold
reserves on the property at 209,200
ounces an average of 0.079 ounces of
gold per ton of rock.
The company said last week that test
results on crushed rock from the area
show that industrial minerals, quartz,
feldspar, mica and calcite could be
recovered along with the gold.
DCM Science Laboratory in Wheat
Ridge, Colo., said the other minerals
from the mine could be sold for glass
making, fillers and chemicals.
"We believe that this unique
approach to our waste rock disposal
could add real value to the company and
its shareholders," Fitzsimonds said.
Another positive report came from
the Knelson Group Inc. of Langley,
British Columbia, an outfit that specializes
in reducing the costs of gold
production.
The Knelson Group said its system
could recover 30 to 45 percent of the
gold mined at Mineral Ridge before
cyanide is added to complete the recovery
process. That would reduce the costs
and shorten the recovery time.
More than geology and processing
techniques have been demanding the
attention of Fitzsimonds and his team.
This summer, Golden Phoenix closed a
$1.8 million private placement, using
the money to pay operational expenses
and the costs of the interim reclamation
bond.
It also repaid $539,000 to Newmex
Minerals of Calgary. Newmex held a
lien on some Golden Phoenix assets,
hampering the Reno company's ability
to finance its plans at Mineral Ridge.
Even so, the company's financial condition
is less than vigorous.
As of June 30, Golden Phoenix
reported current assets of $417,801
against current liabilities of $1.07
million.
During that quarter, the company
posted a loss of $828,168 on revenues of
$34,449. This comes on the heels of
losses of $643,394 and $414,008 in the
two prior quarters.
Along with the Mineral Ridge property,
Golden Phoenix controls the
Borealis gold-silver property in Mineral
County and the Contact copper property
in Elko County.
The company has said, however, that
it's devoted little attention to those
properties as it works on the Mineral
Ridge proposal.
