Flying toward the Finnish line

Agnico-Eagle is jumping into the Finnish gold industry with both feet. The company’s first mine to open outside Canada will be the US$190-million KITTILA GOLD MINE, scheduled to begin production this September.

The cold snowy winters, low hills, bogs and scrubby pines of northern Finland will look familiar to anyone who has worked in northwest Quebec. Likewise, the geology. Most familiar, though, are the millions of ounces of gold waiting to be mined.

The mine is 50 km northeast of Kittila, located in Lapland north of the Arctic Circle and 900 km north of Helsinki. A popular ski resort destination, the little town will soon be the home base for Europe’s largest gold mine. Plans call for average production of 150,000 oz of gold per year for at least 13 years, maybe more. Operating costs are estimated to be US$300/oz.

The original discovery was made in 1986 when coarse visible gold in quartz-carbonate veining was seen along a road cut. The Geological Survey of Finland conducted regional exploration drill programs in the Suurikuusikko area over the next five years. Then the property was put up for auction. The winner was a Swedish junior company, Riddarhyttan Resources AB, which explored the property extensively from 1999 to 2005.

In 2004 Riddarhyttan approached Agnico-Eagle, and the Canadian company recognized the geological similarities with the Abitibi region in Quebec. Agnico-Eagle purchased a 14% interest in the junior company. Just a year later, Agnico-Eagle acquired all of Riddarhyttan in a share exchange. The decision to develop an open pit, an underground mine and a mill was made in June 2006, and construction started immediately.

“The beauty of this project is that we have the luxury of planning years ahead,” said Ingmar Haga, Agnico-Eagle’s vice-president Europe. “We can look at the long-term outcome.” CMJ spoke with Haga after the annual meeting in May, and he brought us up to date on the development work at Kittila.

At the mine site, all the buildings, infrastructure and starter pond for the tailings management area were complete. Open pit mining was to begin in mid-May. Approximately 200,000 tonnes (t) of ore will be stockpiled before milling begins. Three million tonnes of waste has been removed and used to build the tailings dam and site roads. The decline was 3,000 m long, and underground development was on schedule. The first flotation concentrate will go through the mill in August, and the autoclave will come on-stream in September, marking the start of commercial gold production.

The principal pit will be mined for three or four years, and supplemented with ore from satellite pits in later years. The main pit will be about 850 m long by 350 m wide and 160 m deep. The pit area is overlain by swamps, but not an excessive amount, said Haga. Benches will be 5 m high to minimize dilution.

Agnico-Eagle has purchased the larger pieces of mining equipment–five Caterpillar 777F 100-t haul trucks and two Cat 395CL excavators. A local contractor is responsible for drilling blast holes with its own Atlas Copco and Tamrock rigs. A Spanish contractor, Maxam, won the blasting contract and plans to use water gel.

The underground mine is being developed via ramp for open stoping with delayed fill or sublevel longhole production. Stopes will be about 15 m wide by 15 m long, developed on 20-m or 40-m levels. Mining will begin in two areas 50-100 m below the principal pit and between the 250-275-m levels in an area to the north of the pit. Two ventilation shafts (one intake and one exhaust) are being established.

Agnico-Eagle has one Atlas Copco jumbo drill in the mine and another on order. Blasting, loading and ore haulage have been awarded to contractors. The contractor will muck with 4.5-m3 load-haul-dumpers. Ore will be transported up the ramp in 50-t trucks. In a few years Agnico-Eagle anticipates doing all underground work itself, other than the blasting.

Ground conditions appear to be fairly good, according to Haga, although there is more water in the mine than originally anticipated. Extra pumps are keeping it under control. There was no provision for a production shaft in the feasibility study, he said, but the idea may be considered in the next few years when thoughts turn to increasing the Kittila output. At the same time, the use of paste fill will be examined.

Processing the Kittila ore

There is no visible gold in the Kittila ore; the gold is tied up with arsenopyrite or pyrite. The major circuits in the 3,000-t/d processing plant are semi-autogenous grinding, flotation, pressure oxidation and carbon-in-pulp.

Crushed ore will be conveyed to an Outotec single-stage SAG mill, 5.5 m in diameter and 9.2 m long, equipped with a variable-speed, 4,400-kW motor. The mill is in closed circuit with six Krebs Engineering gMax 15 cyclones to produce a grind of 80% -75 microns.

Overflow from the cyclones will be collected in a common launder and sent to the flotation circuit. The slurry will be conditioned ahead of the rougher/scavenger circuit. Roughing consists of four Outotec TankCell-40 cells, and scavenging of two TankCell-40 cells. Up to 24-hours-worth of flotation concentrate can be stored ahead of the autoclave.

The pressure oxidation (POX) autoclave measures 3.4 m in diameter by 24 m long, divided into six sections by internal walls. The slurry temperature in the autoclave is held in a range between 185 and 190C, and pressure is kept at 21 to 22 bars. The slurry remains in the autoclave for one hour, then is depressurized and pumped to the CCD wash circuit where solids are separated from the acidic solution. The solution is neutralized in four agitated tanks to precipitate iron, arsenic and other metals. Slurry from the fourth tank is pumped to the tailings management area.

Washed residue from the CCD circuit feeds the carbon-in-leach (CIL) circuit. Feed is conditioned and then flows to six leach tanks that are 5.0 m in diameter and 7.5 m tall. Cyanide will be added as needed to the first and third tanks. The residence time in the CIL circuit will be 24 hours. The loaded carbon will be stripped and the pregnant solution will pass through an electrowinning cell to recover the gold, which will be smelted into dor bars and then shipped to a Swiss refinery. Gold recovery will be approximately 87%, based on the results of test work.

Tailings will consist of tails from the rougher/scavenger circuit, slurries from the CIL circuit and wash water from the CCD circuit. An SO2/process has been selected for cyanide destruction of CIL circuit tails.

The tailings management plan involves two phases. The Kittila permit requires an impermeable liner for the starter pond. That pond will hold four or five years of tails. Haga said that this period will give the engineers and operators time to figure out how to implement a second, larger phase without the expense of a liner. Most of the water will be reclaimed for the mill; if required, a water treatment plant will be built.

There are few environmental concerns associated with the Kittila mine. The area is rural and supports farming, forestry and the tourism industry. The closest neighbours are a farm 2 km away and a village 5 km distant. The nomadic Smi people and their reindeer herds are found farther north, so their migrations will not be affected by activity at the mine. That and the mining-friendly attitude of the Finnish government have allowed the project to be fast-tracked.

Geology and resources

At the end of December 2007, the Kittila mine was estimated to contain 3.0 million oz of gold in probable mineral reserves. That number was calculated from 18.2 million t of ore grading 5.12 g/t Au and includes material that is recoverable both from open pit (4.2 million t) and underground (14.0 million t).

Other mineralization at the property is divided into an indicated resource of 5.4 milli
on t at 3.03 g/tAu, and an inferred resource of 10.8 million t at 3.39 g/t Au.

The gold-bearing zones are hosted by the Lapland Greenstone Belt that stretches from the Norwegian coast, through Finland and into Russia. The mine area is underlain by green-schist facies (chlorite-carbonate) mafic volcanic assemblages referred to as the Kittila Greenstone Belt. Volcanic rocks are subdivided into the iron-rich and magnesium-rich tholeiites. The transitional Porkenen Formation that occurs at the contact of the two zones consists of mafic tuffs, graphitic metasedimentary rocks, black chert and banded iron formation. The Porkenen Formation is the major host for the gold mineralization.

The Suurikuusikko (SUURI) deposit is hosted by a north-south shear zone containing multiple lenses, with a strike length of more than 15 km and extending more than 1,000 m below the surface. Gold is almost exclusively refractory. The mineralization is associated with fine-grained arsenopyrite (containing 73% of the gold) and pyrite (23% of the gold). Free gold (the remaining 4%) occurs as extremely small grains in pyrite found in the outer, oxidized or eroded portion of the ore.

The Rouravaara (ROURA-C and ROURA-N) ZOnes extend 1,200 m horizontally and to a vertical depth of approximately 650 m below surface. About 19% of the mineral reserves are located within these two zones. The Roura zones contain one to three parallel, gold-bearing lenses.

The land surrounding the Kittila project is an underexplored and very promising area. Agnico-Eagle is drilling extensively and getting promising results. Two new gold zones were discovered north of the mine construction site in 2006–the Rimminvuoma (RIMMIS) and the HAKOKODANMAA areas. In 2007 a new gold occurrence was intersected in the KUOTKO area 10 km north of the mine site.

Exploration drilling to potentially extend the resource envelope at depth in the Suuri deposit has been a priority over the last year. The current resources and reserves do not include recent results from the drilling at depth. The latest drill holes in the Suuri deposit assayed 5.3 g/t Au over 5.1 m, 2.6 g/t Au over 3.0 m, 2.7 g/tAu over 5.9 m and 6.7 g/t Au over 3.0 m. There are high-grade zones as well; a previous hole had even hit 17.3 g/t Au over 4.4 m.

To the end of last year, a total of 891 drill holes totalling 237,519 m have traced the gold-bearing structures over a strike length of 25 km since the first visible gold was spotted in 1986. The consistent grades and growing potential strike length point to a prosperous future for Agnico’s first foreign venture.

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