Reserve calculations, mining, and milling of Homestake Mining’s Open Cut project described

Introduction The Open Cut is one of the best known landmarks in South Dakota's Black Hills. It is the site of the original discovery of the Homestake ledge, or lead, in 1876. Between that time and 1945, the Open Cut produced about 36 Mt (40 million st) of gold ore, the majority of which was drawn from underground operations. In 1981, a drilling program was undertaken to determine how much ore the old timers left behind. The results of this study indicated an ore body made up of broken and caved ground, and solid blocks in pillars and crowns. Reserves are estimated at about 6.8 Mt (7.5 million st) of gold ore, grading at 4 g/t (0.116 oz per st). Total tonnage of material, including waste, is estimated at more than 60 Mt (66 million st). The mining plan is a combination open pit and underground operations. The bottom 78 m (255 ft) will be mined by the underground panel-caving method. The open pit was designed as a contractor operation up to the expected milling stage or the point of sustained ore production. The pit was designed to avoid disturbance of US Highway 85 near Lead, SD. In 1983, the South Dakota Board of Minerals and Environment approved the mining and reclamation plan. Test mining began in the north of the Open Cut using open pit methods. Upon completion of the test pit, Homestake Mining's board of directors approved an expanded mine plan. They committed an additional $27.1 million to prestrip the ore body that is expected to yield 23 t (750,000 oz) of gold. Project life is estimated at 15 years. Exploration program In early 1980, 10 diamond drill holes were drilled from the surface in the vicinity of the east side of the Open Cut. The reserves delineated by that drilling were too small to justify their development. A continuation of this study attempted to quantify the tonnage remaining in the bottom of the Open Cut in the crushed remnants of old stope-and-crown pillars. This was originally thought to be minable by improved drawhole methods using highly mechanized procedures. By early 1981, however, thinking turned toward surface mining methods. The effort to quantify minable ore tonnage ultimately involved drilling 385 reverse-circulation rotary drill holes. These were drilled from August 1981 to March 1983 in several groups of holes. Each group, or drilling program, had a slightly different immediate goal or purpose. The holes were drilled to various depths using truck-mounted Drill Tech 40 drills with doublewalled 76 mm (3 in.) pipe with 134 mm (5.25 in.) three-cone rotary bits. Initially, wet drilling was employed using a cyclone collection system. Since cutting recovery was not as high as it should have been, all subsequent drilling was dry. The cuttings were collected and deposited by way of a cyclone into the sample bag. The pickup for the cuttings using the three-cone bits was about 50 mm (2 in.) above the bottom of the hole. Overall cutting recovery for the drilling program was estimated at 75%. Samples were taken on each 1.5 m (5 ft) of hole drilled. Each sample was split into three 48-g (1-2/3 assay ton) charges. The accepted value was the straight average of the three charges. Because of the known "nugget effect," assays were nearly impossible to duplicate. Therefore, to validate the regular assays, a series of screen fire assays were run. Based on this method of assays and checks, it was concluded that 10% more ounces would be produced than indicated by mine grade. Test pit The northernmost portion of the mine as planned is known as the Terraville test pit. This portion was mined ahead of the rest and separately. It provided answers to questions on slope stability, reserves correlation, mill recoveries, mining costs, and surface mining conditions in various weather and ground conditions since many boulders and much timber were expected. The mining plan for this portion of the pit was successful. More ore was mined than was expected. Mixing of Open Cut ore with underground ore in the mill feed was successful. Impact on the surrounding communities