I’m remembering the heady days of the late 1970s when everyone thought the price of gold was unstoppable and silver topped US$50 per ounce. People everywhere were investing in precious metals and planning to get rich. Enter the Hunt brothers, Nelson Bunker “Bunkie” and William Herbert, who squirreled away more than 200 million oz of silver, about half the world’s supply. When they began collecting in 1973 the price was US$1.95/oz, and by 1979-80 it peaked at US$54/oz. That’s how the rich get richer. But they also get poorer. The silver market collapsed in 1980, and in 1987 the Hunt brothers declared bankruptcy. They were charged with manipulating the silver market, and their conviction was delivered in 1988.
In Canada, these avaricious people left behind a failed mine development, the Prairie Creek project, in the south Mackenzie Mountains of the Northwest Territories. The surface facilities were nearly complete and mine development underway for a 500-tpd operation. A total of Cdn$64 million had been invested. Prairie Creek languished in litigation with other of the Hunt brothers’ assets until 1990. San Andreas Resources bought into the property the following year, and with renewed enthusiasm and exploration breathed new life into the project.
Today San Andreas has become CANADIAN ZINC CORP. The company owns 100% of the Prairie Creek project and 60% of the plant and equipment on site. The inventory is promising: a 1,000 t/d mill 90% complete, road, airstrip, tailings disposal area, camp, maintenance shops, heavy equipment fleet, office, warehouse, lab, generators, fuel, and bulk storage. Three underground levels have been rehabilitated.
Early in 2001, CanZinc produced a scoping study for Prairie Creek, with a view toward reopening it. The deposit contains a resource of 11.9 million tonnes grading 161 g/t Ag, 12.5% Zn, 10.1% Pb, and 0.4% Cu. Contained in the resource are 70 million oz of silver (no wonder the Hunt brothers invested). Reopening would require an injection of as much as Cdn$40 million. CanZinc raised Cdn$2.5 million earlier this month.
With some money in the bank and minerals in the ground, the next step is a bankable feasibility study. Meanwhile, the company is proceeding with various applications and licences. If the devil is in the details, this is where development can be delayed. It will also take faith in the silver price (which today closed at just under US$5/oz) to invest the kind of money needed to get Prairie Creek up and running.
We at CMJ are always happy to see a new Canadian mine come on-stream. So good luck to CanZinc, and we will keep our readers informed.