Western Goldfields Resurrects California Gold Mine Expansion

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Researched by Industrial Info Resources (Sugar Land, Texas). Favorable gold prices have led Western Goldfields, Incorporated (TSX:WGI) (Toronto, Ontario) to take measures to ramp up to full production the Mesquite Gold Mine, located near Brawley, California. Western Goldfields subsidiary, Western Mesquite Mines, Incorporated (Brawley, California), has been producing gold at Mesquite at reduced rates since the company acquired the property from Newmont Mining in 2003. Newmont had previously ceased operations in 2001. Owners of the Mesquite mine have been evaluating a heap leach expansion for more than thirteen years, but market condition have never allowed it to take place. Industrial Info first reported this project in 1993, when then owner Santa Fe Pacific Gold (later acquired by Newmont Mining) began studying an expansion.

Currently, a $98 million expansion program has been proposed and a feasibility study has been completed. The majority of the cost of the expansion will be for $67 million worth of mining equipment, for which purchase orders have been made. This will enable the company to ramp up mine production starting in April 2008.

The remainder of the expense will be for adding a new leach pad and upgrading pumping and processing systems to handle the additional load. The leach pad will be expanded in phases to handle 137 million tons of ore and will be constructed at a cost of around $9 million. Western Goldfields hopes to have financing in place next year to proceed with the construction in 2008.

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