Santa Fe Gold Corporation's (Symbol SFEG.OB) Summit Mine, with its processing facility in Lordsburg, is Santa Fe’s most advanced asset. The project consists of a silver-gold resource in the Steeple Rock Mining District north of the city of Duncan, on the Arizona/ New Mexico border; a mill site near Lordsburg, the site of a previously operating mine (the Banner Mill site); and the Banner Mill, a 400 tpd flotation mill relocated from Winston, New Mexico (with potential for expanding capacity to 800-1,000 tpd). Santa Fe acquired these three assets, successfully reopening, expanding and extending the former “Hansen decline,” and relocating and reassembling the Winston Mill at the Banner site near Lordsburg.
Santa Fe management originally had planned to engage a contract miner, but as prices peaked, they opted to mine the project themselves. The company has recently benefited from falling base metal prices and the reduction in regional base metal mining activity. They have found an abundance of available skilled and unskilled labor. Even with the additional required capital investment in essential equipment to operate the mine themselves, the Summit Mine is coming in under budget, and with potentially lower costs over the scheduled life of the project. Work on the Banner Mill has been completed and ore has been stockpiled at the mill, ready to commence production. Operations should commence upon completion of the upgraded tailings dam, in early 2010. The transition from an exploration company to a precious metal producer during a period of rising precious metals prices has been positively received by investors.
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