A preliminary economic assessment for the Revenue Mine project in southwestern Colorado, based on a 300 t/d conventional flotation plant design and mine plan resources from the Virginius and Yellow Rose vein systems.
Report context
The Preliminary Economic Assessment (PEA) for the Revenue Mine has an effective date of April 18, 2014, and was prepared for Fortune Minerals and Star Resources. The report documents a 2014 design that includes a conventional flotation plant constructed at the project site, with planned processing of mineralized material from the Virginius and Yellow Rose vein systems located in Ouray County, Colorado.
Processing route
Proposed plant design
CH2M HILL Engineers, Inc. provided a detailed engineering design for a 300 t/d plant based on preliminary testwork results and historical information. The designed conventional flotation plant includes two-stage crushing, ball mill grinding, reagent storage, flotation, flotation concentrate filtration for product shipment, and a tailings filtration circuit for dry tailings disposal.
At the time of writing, the plant had been constructed and was being prepared for commissioning. The crushing, grinding, and flotation facilities are located in an underground cavern excavated adjacent to the Yellow Rose exit portal of the mine. Tailing filtration facilities are located in a purpose-built building immediately outside the excavated mill cavern.
Historical operating basis
Historically, mineralized material from the Revenue Mine was treated using what would today be considered a conventional flotation process. Historical production records indicate that between 1895 and 1906 approximately 204,000 tons were milled, with average grades of 14.89 oz/t silver, 0.083 oz/t gold, and 4.38% lead for the period 1901 to 1906.
Testwork basis
Preliminary testwork on bulk samples taken from the mine indicates that base and precious metals may be recovered using standard crushing, grinding, gravity, and flotation methods. The testwork supported the selection of the conventional flotation flowsheet for the planned 300 t/d plant.
Water supply
Water supply for the plant will be provided by mine drainage, which has a minimum outflow of 200 g/m and is of sufficient quality for processing. The company also holds conditional water rights to take up to 3.34 cfs from Sneffels Creek.
Key reported parameters
| Parameter | Value | Basis |
|---|---|---|
| Plant design capacity | 300 t/d | Proposed design (CH2M HILL) |
| Crushing stages | Two-stage | Proposed design |
| Grinding | Ball mill | Proposed design |
| Flotation type | Conventional | Proposed design |
| Concentrate handling | Filtration for product shipment | Proposed design |
| Tailings handling | Filtration circuit for dry disposal | Proposed design |
| Mill location | Underground cavern at Yellow Rose portal | Design/constructed |
| Mine plan total mineralized tons (2014-2021) | 888.3 kt | Design schedule |
| Mine plan average Ag grade | 14.63 oz/t | Design schedule |
| Mine plan average Au grade | 0.02 oz/t | Design schedule |
| Mine plan average Pb grade | 2.26% | Design schedule |
| Mine plan average Zn grade | 0.90% | Design schedule |
| Mine plan total waste tons | 330.7 kt | Design schedule |
| Revenue Virginius Measured + Indicated | 369.8 kt at 19.68 oz/t Ag, 0.03 oz/t Au, 2.91% Pb, 0.83% Zn | Resource classification |
| Revenue Virginius Inferred | 310.9 kt at 12.43 oz/t Ag, 0.02 oz/t Au, 1.98% Pb, 0.69% Zn | Resource classification |
| Yellow Rose Measured + Indicated | 186.86 kt at 9.08 oz/t Ag, 0.02 oz/t Au, 1.51% Pb, 1.39% Zn | Resource classification |
| Yellow Rose Inferred | 20.7 kt at 5.19 oz/t Ag, 0.01 oz/t Au, 1.05% Pb, 0.73% Zn | Resource classification |
| Mining recovery applied | 90% to designed stope wireframes | Design assumption |
| Unplanned waste dilution within stopes | 15% | Design assumption |
| Additional development dilution | 5% to 10% based on development type | Design assumption |
| Cut-off grade | US$50/t marginal | Resource reporting |
| Historical mill feed (1895-1906) | ~204,000 t | Historical operating data |
| Historical Ag production (1895-1906) | ~10.1 Moz | Historical operating data |
| Historical average grade (1901-1906) | 14.89 oz/t Ag, 0.083 oz/t Au, 4.38% Pb | Historical operating data |
| Plant power supply | 12,470 volt, three-phase commercial | Existing infrastructure |
| Water source | Mine drainage (min. 200 g/m) | Existing/design |
Project website: https://www.fortuneminerals.com/investors/share-structure/default.aspx
Technical qualifications
The PEA is preliminary in nature and is based on technical and economic assumptions that will be further evaluated in more advanced studies. The PEA is based on a resource model that contains Measured, Indicated, and Inferred mineral resources. Inferred mineral resources are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the PEA will be realized.
Mine plan resources include a 90% mining recovery to the designed stope wireframes in addition to 15% unplanned waste dilution within stopes. Additional development dilution of 5% to 10% was applied based on development type. Zero grade was used for waste dilution.
Research into historical production records indicates that records are incomplete, particularly for the period prior to 1895. Specific production records for 1876 to 1895 are not available, as many early records were believed stored at the mill and destroyed in the 1912 fire.
The Consultants used their experience to determine if information from previous reports was suitable for inclusion and adjusted information that required amending. This report includes technical information that required subsequent calculations to derive subtotals, totals, and weighted averages. Such calculations inherently involve a degree of rounding and consequently introduce a margin of error. Where these occur, the Consultants do not consider them to be material.
*Source: SRK Consulting (U.S.), Inc., Preliminary Economic Assessment – The Revenue Mine, effective date April 18, 2014, Sections 1.6.1, 1.6.2, 5.5, 6.1*
