Mineral Ridge is the Right Place and the Right Time for Golden Phoenix and Scorpio Gold

The Gold Report – In a recent interview, Paul Dockweiler commented on the Mineral Ridge gold property in Nevada, a joint venture 30% owned by Golden Phoenix (OTCBB: GPXM) and 70% owned by Scorpio Gold (OTC Other: SRCRF; TSX-V: SGN).  He describes the area as having a lot of virgin ground with the same mineralogy as a past-producing mine, and of course, the gold price has since marched up fivefold.  Paul Dockweiler holds a geology degree from Michigan State University, is the founder of consulting firm Silver Spartan LLC, and worked with geologist Steve Craig at Mineral Ridge.  Below is an excerpt of the interview, a complete version of which is available here.

Paul Dockweiler: Golden Phoenix now owns 30% of the Mineral Ridge project in a JV with Scorpio Gold Corp., which owns the other 70%. Mineral Ridge is fully permitted, and Scorpio is placing crushed ore on the leach pad to be in production in a few months.

The Gold Report: But earlier you mentioned something about heap leaching not being particularly effective there. What’s the story?

PD: A lot of the gold and silver is encapsulated in other minerals, especially in some of the metamorphic rocks. In other words, sulfides cover up those gold and silver molecules within the rock. The rock itself is not very porous in a heap-leach operation; you wash the surfaces of these rocks but you do not get much permeation into this rock. In that regard, it comes down to your grind size—how much surface area can you provide for that rock? And how much of that will wash away with your leach? From my understanding, Scorpio has further studied the ore and is focusing on the grind size to adjust its recovery plant and, hopefully, realize a higher yield. Smaller grind size is the key to higher recovery. Reportedly, the last truly profitable operation to mine the deposit was milling the ore.

TGR: But until recently, there’s been limited extraction from the Mineral Ridge complex.

PD: Since then, three companies—including the original Golden Phoenix— attempted heap leach with cyanide without milling. The most they realized was around 60% recovery. At that rate, considering the low price of gold then and the high cost of producing an ounce, it just didn’t work. It’s a different story now that we’re looking at $1,400 gold. If you can produce it at $300/oz., you’re probably okay. So, even though heap leaching is not the most effective way to extract this ore, you can still make a considerable profit based on the price of gold today; plus, Scorpio CEO Peter Hawley has a record of taking a difficult operation and making it profitable. It is my belief, once the operation is fully up and running, a milling operation will become part of the plan.

TGR: Scorpio is in the first phase of a drill program at Mineral Ridge this year. Can you tell us a little bit about that program’s goals?

PD: I don’t know what Scorpio’s plans include, but number one is to find more gold and silver. Just last week, on April 12, Scorpio put out a release on the latest drill results, which look good. It was about 9.15 meters of 2.28 g/t gold. From what the press release said, I think that was even outside of the company’s pit area. It appears Scorpio is discovering mineralization throughout the property—not just within the area identified in a previous open-pit feasibility study. As long as it keeps drilling, I think Scorpio is going to keep finding more and more of this. What its goal would probably include is developing some of the known satellite deposits within the property. These local satellite gold deposits just need more development and I think they’re working on that, as well. Scorpio and Golden Phoenix are doing a great job managing these properties and creating outside interest as a result. They’re coming out with positive news releases and increasing their momentum. Scorpio is planning to produce soon.

Complete Interview


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