Thursday, March 4, 2010

Another key reason for the improved mine plan

During the August 4`09 conference call, Century mentioned that the first 4 months of mining at Lamaque would be conventional mining. They had said that mechanical mining would not begin until months 5 or 6 after mining begins.

I think Century has found that they have had good success (in Jan and Feb) with ordering the ``low-profile`` equipment. As you may recall, this special type of equipment is key to performing mechanized mining in the flats (in the Lamaque 2 area).

It sounds like Century no longer has to wait until 5 or 6 months after mining begins before they can initiate mechanized mining in the flats.

Successes in ordering equipment has allowed us to receive the key low-profile equipment in April (early). From the February 2nd NR:

``Low-profile underground mechanized mine equipment has been ordered, with delivery expected in April of 2010.``

Further good news, we are now expected to receive some of the low-profile equipment even earlier (starting March 15th). From the March 1st NR:

``Other notable items include the commitment of approximately $7.0 million for new and near-new underground mining equipment for delivery commencing March 15th, 2010. New lease lines are being put in place to support the acquisition of this equipment, which includes a combination of low profile scoops and jumbo drills, as well as mine trucks and miscellaneous mine equipment. The equipment shop facility is full of existing equipment which is being readied for the start-up of mining the first week of March 2010.``

This success has likely resulted in speeding up mechanical mining by about 3 - 5 months.

Best I can analyze, there are (at least) 4 key successes that have contributed to the improved mine plan at Lamaque:

1) success in ordering mechanized equipment for the flats

2) mine development successes

3) success in rehiring former miners (already having knowledge and experience at Lamaque)

4) exploration success


For those who haven`t seen it as yet, here is a copy of part of my post from a few weeks ago about the importance of this ``low-profile`` equipment:


``From the latest conference call:

*25% of our reserves and resources are sitting in flats

*historically, room and pillar mining was done on these flats at Lamaque, using jacklegs, slushers, etc.

*a couple of the mining equipment companies have built this new low-profile new mining equipment

*with the advent of this new low-profile equipment, long tom drills and low-profile trucks (low-profile jumbos), we are going to convert completely to what Century calls mechanized mining

*as a result, Lamaque will have some of the latest technology in the industry – some of the equipment is actually coming up from South Africa, where they are currently using this low profile equipment

*all of our jacklegs are going to Peru, where we are still mining very narrow veins and fairly flat dipping areas (the jacklegs will represent an update at San Juan)``

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