By Michelle Smith — Exclusive to Silver Investing NewsTailings are materials produced from mining such as milled rock and effluents. In many cases, massive quantities of these materials, regarded as waste, are left from previous operations. Given the potential health and environmental risks associated with tailings, they could be viewed as problems or project deterrents, but then again, they could be viewed as a source of cash.
In October, International Silver (OTC Pink: ISLV) announced the signing of a letter of intent with Aurum LLC, owner of the Caselton Tailings, in anticipation of a joint venture agreement. The tailings, according to an independent engineer's report cited by International Silver, contain approximately 1,819,800 ounces of silver and 55,710 ounces of gold prior to the application of a recovery factor.International Silver hopes to operate the Caselton Tailings project while finalizing drilling and testing at its adjacent Prince mine. Before embarking on that plan, the miner will first conduct further validation sampling and metallurgical testing to reconfirm tonnages, grades, and recovery of the precious metals values. How metal is to be recovered from tailings is an issue of particular importance, as it will factor heavily into the success of the project. There are several options that could be considered, and the circumstances surrounding them, such as costs and recovery rates, can vary. El Tigre Silver, for example, is modeling its project after Dia Bras Exploration (TSXV: DIB,OTC Pink:DBEXF) whose silver tailings recovery in Mexico dates back to 2009. As a result, El Tigre Silver concluded that the Merrill Crowe method is the best. PanTerra Gold will be using an option known as the Albion process. Tailings and public concern Another consideration is the attitude toward the existence of particular tailings. Mining waste can be a sensitive issue given health and environmental concerns. Tailings, from silver operations or otherwise, and the circumstances of their disposal and storage, are issues of growing concern for the public and environmentalists. The Clayton Silver Mine, for example, was a large producer of silver and lead in Idaho that operated from 1935 to 1985. It had a massive tailings pile 15 acres in size that was in direct contact with a creek. Erosion led to contamination flowing downstream, eventually making its way to Salmon River. Concerning levels of metals were found in the soil in the town of Clayton, and the threats posed by continued wind and water erosion led the community to embark on a clean up mission nearly a decade later. A mining company would likely want to avoid getting entangled in a project where the government or community has soured attitudes due to prior damage, or where there is an agenda for justice.
Miners are often seen as agents of damage, but when there are positive attitudes at play, tailings projects can offer the opportunity for companies to change that by providing communities with solutions for problems created in the past.Steven Craig, Vice President of Exploration at El Tigre, said the tailings at the site of El Tigre's project in Mexico were dumped directly on top of the ground. “For about 100 years, they have been rained on with the drainage flowing down into the river, which is not good,” he said. If El Tigre's tailings project is successful, it will do more than provide the company with cash flow. The reprocessed waste materials will be moved to a location where it will be stabilized using plastic barriers and rocks, reducing the associated risks. “With the project we will clean up the site and create jobs,” said Craig. Securities Disclosure: I, Michelle Smith, do not hold equity interests in any of the companies mentioned in this article. Silver Tailings: Profitable Waste? from Silver Investing News