Nexindio Mining Corporation

El Indio: sky's the limit

SECTION: CENTRAL & SOUTH AMERICA SUPPLEMENT; Pg. 20

LENGTH: 567 words

The El Indio gold-silver-copper mine is located 4,000 m above sea level high in the Chilean Andes some 480 km north of Santiago and 177 km inland from the coastal city of La Serena. The actual deposit was discovered in 1975 by geologists who were working for St Joe Minerals but, as recently as the 1970s, the site was being mined by local independent miners who hand-selected ore and transported it by mules.

Compania Minera el Indio first came to prominence when it was put into full production by St Joe (owning 82.95%, in partnership with local Chilean interests) in 1981. Initial plans called for the regular production of over 175,000 oz/y of gold, 53 t/y of silver and 13,000 t/y of coppen El Indio subsequently changed hands on a number of occasions. Days before El Indio's mill came on-stream, St Joe Minerals became St Joe Gold Corp., a subsidiary of Fluon El Indio's gold output in both 1982 and 1983 was around 360,000 oz/y. However, output started to decline, and by 1986 it had fallen to 260,000 oz/y and in 1987 was nearer 185,000 oz.

In August 1987, St Joe Gold was sold to Dallhold Investments, Alan Bond's family company (later Bond International Gold, BIG). In October 1989, Lac Minerals bought a 65% interest in BIG. Over the following five years, the output at E1 Indio hovered around 200,000 oz/y. A feature of this period was the almost minimal annual expenditure on exploration, typically around $ 2 million.

Finally, in September 1994, American Barrick (now Barrick Gold, acquired Lac Minerals and became the owner of El Indio. Taking a long-term view of the property, Barrick is spending around $ 20 million each year on exploration, has constructed an airstrip at over 4,000 m elevation adjacent to the mine, and has spent considerable sums on processing plant and roaster improvements.

El Indio is now an entirely underground operation, working the E1 Indio and adjacent Viento veins by mechanised underhand cut-and-fill and long-hole stopinc, access to the workings being via a 540 mlong decline. In some of the higher grade stopes, the ore is currently running at 40 g/t Au, although the average head grade to the mill is 6.2 g/t Au and 4% Cu.

A major capital project in the El Indio/Viento mine is the sinking of a subvertical circular shaft, 4.9 m in diameter, the planned depth below shaft collar being 545 m. This will be used for exploration and exploitation of deeper ore reserves.

In April 1995, Barrick brought into production the nearby Tambo mine, comprising two open-pit operations, the Wendy and Kimberly, worked with 13 m high benches. Typical ore production is 6,500 t/d, with a 9:1 stripping ratio, the average ore grading about 3.2 g/t gold, with silver values. Tambo ore contains no copper and the mine has its own mill.

The El Indio and Tambo mines lie on the E1 Indio belt, a highly prospective Andean zone about 175 km long and up to 14 km wide, of which Barrick's leases cover 1,300 km<2>.

In February, Barrick announced that it was to develop a third gold mine within this belt. The Pascua mine, formerly known as the Nevada project, some 50 km to the north of El Indio, has an estimated reserve of 3.4 Moz of gold, considerably more than the 1.8 Moz delineated when Barrick acquired the property in 1994. A new deposit has been discovered at Pascua, and Barrick believes that there is significant future unexplored potential.

SUBJECT: COPPER MINING (89%); MINES & MINING (89%); UNDERGROUND MINING (89%); SURFACE MINING (78%); GOLD MINING (78%); GEOLOGY & GEOPHYSICS (77%); MINING OUTPUT (76%); CAPITAL EXPENDITURES (68%);

COMPANY: SKY'S THE LIMIT (91%); CIA MINERA EL INDIO (57%); CIA MINERA EL INDIO (57%); BOND INTERNATIONAL GOLD INC (54%);

INDUSTRY: NAICS212234 COPPER ORE & NICKEL ORE MINING (57%); SIC1021 COPPER ORES (57%);

PERSON: ALAN BOND (67%);

COUNTRY: CHILE (93%); SOUTH AMERICA (79%);

CITY: SANTIAGO, CHILE (73%);

COMPANY: SKY'S THE LIMIT (91%); CIA MINERA EL INDIO (57%); CIA MINERA EL INDIO (57%); BOND INTERNATIONAL GOLD INC (54%);

LOAD-DATE: May 07, 1996

LANGUAGE: ENGLISH

GRAPHIC: Picture, Primary crusher at the Fachinal gold mine.