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Wharf not as golden in 2013

PIERRE -- The Wharf mine produced fewer ounces of gold in 2013, a company official said Thursday during a presentation to the state Board of Minerals and Environment.

Wharf is South Dakota's only large-scale gold mine still operating.

Environmental Manager Ron Waterland said Wharf mined 2.3 million tons of ore and generated 56,237 ounces of gold and 57,167 ounces of silver.

The company paid $2.7 million in state severance taxes last year, along with $1.1 million in state sales and use taxes and $437,000 of Lawrence County taxes, he said.

Wharf produced about 68,000 ounces of gold in each of the two prior years.

The company significantly reduced nitrate levels in groundwater in the Ross Valley area of the mine and will apply those methods elsewhere at the site, according to Waterland.

"We're seeing some real success there," he said.

But Wharf officials also need to repair the cap on the West Liberty pit, because water and oxygen are reaching the rock buried there, creating acid drainage. Waterland said the timetable calls for finishing the final design this summer.

The rebuild of S.D. 473 along the revised route was completed just before the October blizzard, according to Waterland. He said the project's contractors received the annual "outstanding" award from the South Dakota Engineering Society.

Post-closure work continues by Barrick employees at the former LAC Minerals and Homestake mining operations.

The board approved conversion of the Homestake letter of credit to a surety bond, in the same amount of $39,626,023. The purpose of the post-closure bond is financial assurance in case Barrick can't continue maintaining the many pieces of property that are part of the closed Homestake operation, including its water-treatment system.

Company officials said the change would save Barrick approximately $89,000 annually.

VMC's proposed Deadwood Standard mining project hasn't completed its state and county permitting steps yet, according to geologist Mark Nelson.

"We do not have a date at this time," he said in response to board chairman Richard Sweetman's question about the start-up schedule.