Production started at the Jokisivu Gold Mine

Early summer 2010 Dragon Mining Ltd has to decide whether or not to quarry underground, says Chief Geologist Pentti Grönholm. Photo: Harriet Öster

Work started at the Jokisivu gold mine in Huittinen in May 2009. The Jokisivu mine is the second gold mine to be opened in Finland recently by Dragon Mining Ltd – Orivesi being the first one. Several new gold discoveries are also being studied.

The fact that there is gold ore at several locations in Southern Finland has been known for a long time. The first indication of a deposit in Jokisivu was obtained in 1964 when a young man submitted an interesting rock he had found in his backyard to an ore prospecting competition. The ore deposit itself was found by drilling in 1985. The gold mine in Orivesi was opened in 1993 and closed as unprofitable in 2003.

These gold findings of Outokumpu Mining Oy were transferred to the ownership of the Australian Dragon Mining Ltd when Dragon Mining Ltd acquired Outokumpu’s subsidiary Polar Mining Oy in 2003. The increasing world market price of gold and discovery of new ore reserves inspired the new owner to reopen the Orivesi mine in 2007. After extensive studies, permit applications and profitability calculations, the decision to open Jokisivu was made this year.

Dragon Mining Ltd´s third active goldmine is Svartliden in Northern Sweden, opened in 2005.

Intensive studies, benefication research and drilling started at Jokisivu in 2000. This took four years. So far, more than forty-five kilometres of diamond drill holes have been drilled in the area. An environmental permit for the mine was obtained after a four-year process in late 2007, says Polar Mining Oy Chief Geologist Pentti Grönholm. Grönholm was previously employed by Outokumpu, and has thus been observing the Jokisivu site for a long time.

Current gold price level enables continuation

Constraction works at the Jokisivu mine started in the spring, and mining at the Kujankallio open-cut mine is now well underway. An open-cut mine is also being planned for the second deposit in Jokisivu, Arpola, a couple of hundred metres from Kujankallio. The very first rock was found in 1964 in the yard of the Arpola Farm by the farm’s current owner.

The Kujankallio open pit mine is 300 metres long and 100 metres wide, and it will be gradually mined to a depth of 40 metres. This depth will be achieved during the early part of next summer. – Before that, we must decide whether or not we will continue mined underground. The deeper we go, the more expensive the activities become; thus the mine needs to yield a higher gold content to remain profitable, Grönholm explains.

With the current price of gold – USD 1,000 per ounce – open pit mining is highly profitable, however. When the first decision to start mining was made, the price of gold was less than USD 500 per ounce. The cost level has clearly increased since then, and the exchange rate of the US dollar and the euro has changed.

The current price level would enable fairly deep underground mining, Grönholm assesses. The deposit is not limited; the deepest survey holes have shown that there is gold deep within the bedrock. There are several ore zones in Jokisivu, and the gold content of these varies from a couple of grams to more than a hundred grams in one tonne of ore. The most interesting zone has been drilled every ten metres.

Gold can be found in white quartz

It has been estimated that the current Jokisivu mineral resources amount to approximately 1.5 million tonnes. At Kujankallio open-cut, the average gold content of the ore is 4.7 grams per tonne, of which 84% can be recovered. Approximately 400 kilograms of gold will be obtained during the first year of open pit mining.

The ore host rock in Jokisivu is diorite and there are also a variety of granitoids as well as metamorphosed vulcanites and sediments. During deformation, shear zones were generated in the diorite, and auriferous quartz veins were created in these zones.

The gold ore can be seen as white stripes of quartz in the otherwise dark rock. Pyrite occurs in addition to the gold, which is typical for gold deposits. An interesting mineral is scheelite. which becomes visible under UV light and can be used as an indicator mineral when studying drilled samples.

Nickel enrichment plant for recovery

Rocks containing gold are transported from Jokisivu to the Vammala enrichment plant approximately forty kilometres away. The plant was originally built for a nickel mine that was subsequently closed down. The enrichment plant was purchased by Dragon Mining Ltd in the corporate acquisition. Both nickel and gold can be enriched utilising a flotation process, so the plant is very suitable for Dragon Mining’s needs. Ore from Orivesi is also transported to Vammala for enrichment.

– We mine ore at Orivesi several hundred metres below ground level. More than half of the combined production costs of Orivesi gold are generated during mining. A fifth of the costs arise from smelting, and the rest comes from enrichment, and transport of ore and mineral processing reagents, Grönholm says.

A typical feature of mining activities is that approximately fifteen per cent of all the rock mined at Jokisivu is ore to be taken to the enrichment plant – the rest is waste rock. After crushing, gravity screening and flotation, only a couple of per cent of the ore finally ends up in enrichment – the rest is enrichment waste or quartz sand. The final concentrate contains 200 to 300 grams of gold per tonne. The most important buyer of the end product is the Boliden Ab smelting plant at Harjavalta. The actual bullions are manufactured there.

TEXT Harriet Öster