The conceptual operating plan, submitted to DSL in 

 August 1988, calls for new construction and/or modification 

 of the Weed Concentrator in Butte to separately process the 

 underground ore. The Weed Concentrator is currently operated 

 by Montana Resources, Inc. (MRI) . Tailings would be mixed 

 with MRI's tailings and pumped to the existing Yankee Doodle 

 Tailings Pond. The mine would produce 1,500 tons of ore per 

 day and operate two shifts per day, five days per week. The 

 concentrator circuit would operate 24 hours per day, seven 

 days per week. The estimated total work force would be about 

 200 people (New Butte Mining, Inc. 1988) . 



As part of it's operating application, NBMI has 

 completed an environmental baseline study and anticipates few 

 environmental problems. The rising ground water in the Butte 

 mines is currently 800 feet below NBMI's operations and 

 should not approach its' levels because of the elevation of 

 the workings on the hill, under the city of Walkerville. 



NBMI estimates that there are enough base and precious 

 metals left in the Butte district to provide employment 

 opportunities and profit potential for many years to come, 

 depending on the price of these metals and environmental and 

 operational considerations. NBMI plans to submit an 

 application to DSL for a full-scale mining permit in December 

 1988 and hopes to begin mining by mid-1989. 



Pegasus Gold Corporation 



The Pegasus Gold Corporation submitted an application in 

 February 1988 to mine gold and silver in the German Gulch 

 drainage, located about 18 miles southeast of Anaconda and 18 

 miles southwest of Butte. Pegasus acquired the property from 

 Montoro, which withdrew its application after encountering 

 difficulties during the permitting process. Pegasus Gold is 

 a Canadian corporation with headquarters in Spokane, 

 Washington. Pegasus also owns the Montana Tunnels and 

 Zortman/Landusky projects. 



DSL issued a mine permit to Pegasus in July 1988. The 

 development and construction phase was completed in early 

 fall and mining commenced in October. The mine plan for the 

 project calls for open pit mining methods with a cyanide heap 

 leach facility on the Beals Hill saddle (7,600 feet). The 

 operating permit boundary encompasses 1,182 acres. The ore 

 deposit contains low-grade gold, silver, and various other 

 elements. The ore will be crushed to one-half inch, and no 

 fine tailings will be generated. The heap leach facility has 

 two clay liners and a 40 ml/PVC liner to prevent ground water 

 contamination. There will be cyanide destruction capability 

 on site (Pegasus Gold Corporation 1988) . 



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