Barrick Gold Corporation (ABX, Financial)(TSX:ABX, Financial) reported Sept. 15 that the government of San Juan province, Argentina, has temporarily suspended operations at the Veladero mine for inspections of the mine's heap leach area after a small quantity of a solution that contains cyanide spilled out on Sept. 8.
Barrick said the solution didn’t reach any water diversion channels or watercourses and the affected area in the leach valley has now been remedied so the incident did not pose any threat to employees, communities or the environment.
What’s heap leaching?
"Heap leaching is the process to extract precious metals like gold, silver, copper and uranium from their ore by placing them on a pad (a base) in a heap and sprinkling a leaching solvent, such as cyanide or acids, over the heap. This process dissolves the metals, and they collect at the bottom of the pad. The metal is then further processed. This methodology is mostly used for low-grade ores and the basic processing steps involve crushing and sometime grinding."Â –Â Technomine.com
Picture: illustration of the process
Source: BioMineWiki
The Veladero mine is a conventional open-pit operation located in the San Juan province of Argentina at 4,000 meters to 4,850 meters above sea level, approximately 374 kilometers northwest of the city of San Juan.
At Veladero the ore is crushed by a two-stage crushing process and transported via overland conveyor and trucks to the leach pad area. Run-of-mine ore is trucked directly to the valley-fill leach pad.
Source: Barrick Gold Corporation’s website
In 2015 Barrick produced 602,000 ounces of gold at an AISC of $946 per ounce.
Barrick doesn’t anticipate any material impact of the cyanide spill incident to Veladero's operating guidance. Gold production is expected to be 580,000 ounces to 640,000 ounces at all-in sustaining costs of $790 to $860 per ounce.
The area is unfortunately not new to this kind of incident; as a matter of fact the area had three cyanide leaks in 2011-12 and another one in September 2015 for which Barrick was fined 145.7 million pesos ($9.82 million) last March by Argentina's San Juan province for mining code breaches that led to a cyanide spill.
All the cyanide leaks have been contained by the mine's control system and were duly reported to the appropriate authorities. They never represented a potential risk to the environment.
Barrick closed at $17.65 per share, up 47 cents (or +2.74%), with 25,959,100 on the New York Stock Exchange.
Disclosure: I have no positions in Barrick Gold Corporation.
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