Running the environmental and mining permitting gauntlet is no small task in this day and age, but one Canadian junior mining company, Vancouver-based Merit Mining Corp., has succeeded in obtaining all the required permits to process a 10,000 tonne bulk sample and move on to general mining operations at its Greenwood Gold Project located in southeastern British Columbia between the communities of Greenwood and Grand Forks.

The Greenwood Gold Project, comprised of a newly-constructed mill and tailings facilities utilized in processing ore from the Lexington-Grenoble, Golden Crown and Lone Star deposits is situated in a mountainous area spanning the Canadian/USA border.  Lone Star is located on the Washington side of the border while the other two are inside British Columbia.  Although Greenwood and Grand Forks lie relatively close at hand, the area has abundant wildlife and, during our recent late spring visit, we were fortunate enough to see both a black bear and an enormous bull moose ambling along area logging and mining roads.

While Merit holds interests in several projects, including the J&L property to the north of Revelstoke, BC, their primary focus has been to bring the Greenwood Gold Project into production.

Lexington-Grenoble, Golden Crown and Lone Star deposits have seen activity since late in the nineteenth century but modern resource exploration work began in 1967.  From that time until the present, some 255 diamond drill holes have taken place and a 900 meter access decline was completed in 1996 which has since enabled considerable underground exploration to occur.  Based on prior activity and Merit’s own work, the company was able to commission a fully-compliant resource estimate which was published in late 2006.

According to that estimate, Lexington-Grenoble contains 297,000 tonnes in the “Measured & Indicated” category grading 8.36 Grams per tone (gpt) gold and 1.35% copper, which works out to 79,800 ounces of gold and 8.85 million pounds of copper.  Inferred resources amount to 45,000 tonnes containing 9,500 ounces of gold and 1.02 million pounds of copper.  For Golden Crown the figures are 105,000 tonnes of Indicated resource holding 46,500 ounces of gold and 1.27 million lbs copper plus another 8,000 tonnes of Inferred resource holding 4,300 ounces of gold and 100,000 pounds of copper.

On the American side, the figures for Lone Star are 63,000 tonnes of Indicated resource and another 682,000 tonnes of Inferred resource containing a total of 34,600 ounces of gold plus 33.26 million lbs Cu.

Geologically, ore at the Greenwood Project is associated with a major compressional tectonic event in the Mesozoic Age which resulted in the development of five thrust faults in the region.  All of the significant mineralization and deposits on the Lexington-Lone Star property are spatially and genetically associated with the Number 7 fault.  It has recently been recognized that some of the vein systems in the Greenwood Camp, including the Golden Crown vein system on the Golden Crown property, are intrusive-related, Au-Cu pyrrhotite veins consistent with the Rossland-type veins.  The Rossland Camp, 45 km (27 miles) east of Golden Crown historically produced in excess of 2.7 million ounces of gold at a grade of 16.1gpt.

The mill site itself is located just below a major area logging and mining road and the operation is comprised of a crushing plant located adjacent to but outside of the mill building, ore grinding facilities, gravity concentration circuitry for gold, flotation circuitry for recovery of copper and a dewatering facility to create a pancake copper concentrate for shipping to refineries.

As planned, the crushing plant will operate eight hours per day, five days per week, but the mill will operate on a continuous basis. 

There are two circuits located inside the mill and the initial one we visited was designed for recovery of gold liberated in the grinding circuit and then sent on to a concentrating table for upgrading.  All remaining material is then sent on to be incorporated into the flotation circuit designed to create copper concentrates which then are de-watered in a thickener, filtered in a pressure filter and bagged for shipment to an off-site smelter.  Merit designed the operation to use 5,000 pound bags but the refinery recently noted they would prefer a larger 6,000 pound bag.  The company is presently working to resolve that dilemma.

Greenwood Project Safety Coordinator Tom Scheveldave, who also acted as our tour host and guide, pointed out that safety considerations occupied a high priority at both the milling and mining operations.  In fact, one of the most interesting projects we observed while visiting the underground operations at Lexington-Grenoble was watching a crew accomplish the installation of safety metal mesh canopies along the rooflines of underground tunnels in order to prevent any injuries from falling overhead debris.  The canopy is created by driving metal rods into the tunnel ceiling, then inserting safety netting into place, using the rods for support.  We witnessed the drilling of the holes as well as insertion of the rods. 

Relationships with area Indian Bands are important to Merit and on May 12, 2008 the company was able to announce the signing of an “Impacts and Benefits Agreement” (IBA) with the Osoyoos Indian Band (OIB).  In return for their support for the Greenwood Project, the IBA provides for potential employment opportunities for OIB members, business opportunities, education and training assistance, and revenue sharing plus Merit’s contribution to the OIB Nk’Mip Desert Culture Endowment Fund.  Given the Indian Band’s concern for preserving the environment of their tribal lands, an Environmental Management Committee will be established to provide a forum for open dialogue between the company and the OIB with respect to the environmental impacts and potential impacts on the project area.

We were delighted to meet with the first aboriginal worker at the mill, a young woman named Tahnee Chief, who had received training in mill operations.  She indicated she was pleased to be working at the plant and welcomed the opportunity to receive training in skills which could be of genuine value in her lifetime work.

Thanks to previous exploration through the years, two kilometers (1.2 miles) of underground drifting, crosscuts and raises exist, with the Main Zone exposed for a distance of 0.85 km along the drift.  Historic drilling has defined the Main Zone for a 1.4 km strike length and surface exploration work has identified a total strike length along the Main Zone of three kilometers.

The company completed a $10.8 million program in summer 2007 and is now at work on underground rehabilitation and development, plus an exploration program involving underground diamond drilling which is a much more cost-efficient exploration method than surface drilling.

To facilitate their development work, the company recently completed a 40-man camp and constructed a shop/mine complex.   Their 2008 program includes 1,000 meters of underground development and 5,000 meters of underground drilling with the goal of completing a fully compliant resource estimate by year-end 2008 and a pre-feasibility study is already underway.

Merit is managed by a competent and experienced management team headed by President and CEO Fred Sveinson.

For further information, contact the company via e-mail at info@meritminingcorp.com or visit their website at www.meritminingcorp.com

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