General Metals to remove old buildings and equipment

General Metals announced that it retained a contractor to remove the old Independence Mill site. This will enable the company to proceed in development of its mine to begin production at the company’s Independence Mine project in the Battle Mountain Gold and Silver Mining District, Lander County, Nevada.

The agreement allows for the survey and removal of existing mill site buildings, machinery, equipment, parts and debris on the Independence site with the objective of bringing the area into compliance with 43 CFR 3809. The contractor has already begun removing the mill building and equipment used in recovering gold and silver during the last few years of production from the property in the 1980s. Reported historic production by the various operators totaled 750,200 ounces silver and 11,029 ounces gold.

The old Independence mill site is located in the area of the company’s planned open pit mine. The reclamation work addresses the mill site disturbance by previous operators. The removal of these buildings and obsolete milling equipment will enable the company to optimize the open pit design and thereby maximize the project’s mineable tonnage.

“Our plan all along has been to remove these structures first so we can begin mining,” stated Daniel J. Forbush, president and director of General Metals Corporation. “The old buildings sit on top of the mineralized zone included in the resource calculations. The measured and indicated gold resource in the shallow mineralized zone increased by 7.5 percent from October 2009 calculations to 223,200 ounces in 16.1 million tons. The silver resource totals 3,784,400 ounces. At the London PM fix on October 12, 2011 of $1,682 per ounce for gold and $32.89 per ounce for silver, a deposit containing 297,000 ounces of gold equivalents would have a gross in situ value of approximately $500 million.”

The company is developing a plan for open pit mining of the near surface gold and silver resources and for heap leaching the gold and silver ore.

Forbush concluded, “The removal of these old mill structures will facilitate fast-track design of our open pit and leaching operations.”