Silver Mine - Mine planning

Taivalhopea Joint Venture (TJV) completed very detailed mine technical plans during the late 1980's and early 1990's. These plans included detailed underground and open pit mining plans, processing plant engineering plans and all the necessary infrastructure planning for the Silver Mine operation. Sotkamo Silver's work will be heavily based on this existing, excellent work. Our main focus will be in updating the previous plans and ensure that all plans comply with current standards, laws and regulations.

A preliminary view of the planned minesite infrastructure

Sotkamo Silver has already started to plan and construct infrastructure for the mining area. These plans are based on the work performed earlier by Taivalhopea JV. Plans include views and ideas about how different elements of the mine should be located in the region. Aspects already taken into consideration include the preliminary location of the tailings pond, processing plant, office and maintenance premises and storage facilities. Below is a map, which presents a view of how key operations will be arranged within the mine area. This map shows the mine site area as it has been presented in the mining concession application.

Picture 1. View of the Silver Mine mine site and the borderline (red) of the mining concession.

Open pit

The Taivaljärvi silver deposit is a subcropping under a four to five-meter thick overburden. The subcropping orebody is approximately 500 meters long, and in its widest point, about 100 meters wide. The planned open pit area will be approximately 200-300 meters long and around 50-70 meters wide. The maximum depth of the open pit will be 50-80 meters and approximately 300,000-500,000 tons of ore will be extracted from the open pit area. This open pit phase could last one to one and one-half years. Underground mining operations could start at the same time as the open pit operations or six months to one year later.

Underground mine

Detailed plans regarding the underground mining in the Silver Mine were completed by Outokumpu in the late 1980's and early 1990's. These plans showed, even at that time, that the best mining method for the type of ore that exists in the Silver Mine deposit is a sublevel stoping with backfill. The existing tunnel can be used in the haulage of ore from under ground to the processing plant. Underground mining will most likely commence at the same time as the open pit mining, or possibly some months later. When the open pit ore has been exhausted all the production will come from underground.

The current measured and indicated mineral resources are about 6 million tonnes, but Sotkamo Silver believes it can increase the quantity of mineable ore tonnes during the on-going drilling campaign. Sotkamo Silver believes that the amount of mineable reserves could be raised to more than fem million tons in future. With an estimated production rate of 350,000 - 450,000 tpa, this would enable continued production in the Silver Mine area for an about ten years. In order to prolong the life span of the mine, the Company pays special attention to the deep extension of the mineralization in the future drilling campaign. This deep extension begins at  - 650 meters below surface extending downward. All drill holes that reached the deeper levels in earlier drilling projects indicate that the mineralization continues below the depth of - 650 meters.

Mineral processing and metallurgical testing

Metallurgical testing and research were completed at the Silver Mine as a part of the feasibility study which was completed in 1991. Laboratory scale mineral processing tests were carried out during the 1980's by The Mineral Processing Laboratory of the Geological Survey of Finland GTK (earlier called State Technical Research Centre VTT). The results generally demonstrated that the mineralization is amenable to concentration with standard flotation techniques. The review and upgrade of historic metallurgical tests and mineral processing flowcharts were commissioned from the Geological Survey of Finland/Mineral Processing Unit in Outokumpu in early 2007. An updated report was received at the end of August 2007 and the results are being reviewed under the Current Work/Processing Update. GTK is a worldwide leader among mineral and metal-processing laboratories, which provides innovative tailored solutions for a wide variety of customer needs in the mining industries.

GTK has conducted the Mini Pilot metallurgical test work for Sotkamo Silver during spring 2011 as a part of the feasibility process. The samples treated represent the head-grades in the production. In the locked cycle test the total silver-recovery according to the test was 76,2 % and 90 % for gold.

According to the Geological Survey of Finland the Silver Mine ore is in general simple to be concentrated; with a simple process and reasonable reagent-consumptions, fair concentrate grades can be yielded with satisfactory recoveries. After the experience of the present test work, GTK is still considering the earlier engineering study as valid. According to these pilot tests, the silver recovery was readjusted to 86-91%.  The earlier study (C/MT/2007 /28) is reported by GTK in 2007.

Summary reports are published on Sotkamo Silvers AB's website: .

The newly updated processing flowsheet seen below is taken from that study report.

Proposed mining operation

The Company's proposed mining operations at Silver Mine are based on the assumption that approximately 3 million tons of previously outlined 13 million tonnes of mineralized material are financially viable ore, mineral reserves, at the first stage when the complementary drilling program was carried out. At this time, the quantity of rock to be excavated annually is estimated at 350,000 to 450,000 tonnes. The applied stoping method will be sub-level benching with backfilling. The planned concentration method is to be a conventional flotation process, which will produce two types of concentrate: zinc and lead-silver. Annual projected concentrate production is estimated at 4,000 to 5,000 tonnes. Tailings from the floatation process will be stored in two to three partitions in a tailings pond, which will be constructed in the area. The size of the tailings pond is projected to be 50 to 100 hectares.

Over the lifetime, ore will be excavated both from an open pit mine as well as from an underground mine operation. The open pit phase will be 6 to 12 months, and then the operation will move underground. During the initial phase, ore excavation will occur simultaneously from the open pit and the underground operation. The proposed area of the open pit operation will be five hectares by the end of the operation.

The projected mine life is 6 years (JORC 2012 compliant). The proposed mine site will include all essential facilities and buildings required to conduct a mining operation and will consist of a concentration plant, a concentrate storage facility, maintenance and workshop areas, offices, parking, a transformer station and contractor's warehouse. Preparatory work for a feasibility study was completed during 2011. It has consisted of calculation of the preliminary resource estimate, completion of an environmental baseline study, a processing update, preparation of a technical mine plan and financial calculations. The Company's plans are to begin mine construction in 2018. The management shall take a production decision during 2019, with a proposed start of production during spring 2019.

The image below: First draft for an underground development