en.Wedoany.com Reported - Blue Lake Resources (CSE: BLLG; US-OTC: BLAGF) announced commercial production at its Dome Mountain mine in northern British Columbia, Canada, in mid-May, reaching this milestone after the small underground mine exceeded 100 tonnes per day for 30 consecutive days. The company plans to steadily increase production to 150 tonnes per day before the drill rig returns later this year. CEO Rana Vig stated that commercial production is not the main storyline; exploration is the future focus, as the company has neither completed nor intends to complete a preliminary economic assessment for the project. The mine is located about an hour's drive from Smithers, approximately 680 kilometers northwest of Vancouver.
Vig noted that drilling, rather than production milestones, will be central to future development. If the mine can self-fund resource growth, Blue Lake may achieve what few junior mining companies can: expanding a high-grade mine through self-financing in a province where permits are difficult to obtain, avoiding discounted share issuances when market conditions shift. The company's Toronto-listed stock has fallen approximately 6.5% over the past 12 months, with the latest trading price at C$0.72 per share last Thursday, giving it a market capitalization of C$108 million (approximately US$76.4 million).
Blue Lake has generated approximately C$4.5 million from gold and silver sales. With the mine reaching 150 tonnes per day and stable material supply to toll-milling partner Nicola Mining (TSXV: NIM; US-OTC: HUSIF), more regular payments are expected. Dome Mountain plans to produce 15,000 ounces of gold over the next 12 months, with annual production subsequently moving toward 20,000 ounces. The mine's grade of approximately 9 grams per tonne, silver by-product revenue, and the toll-milling agreement allow the company to achieve exploration goals without building an on-site processing plant or tailings facility.
Chief Geologist and Dome Mountain Project Manager Bill Cronk stated that narrow-vein mines must open enough underground working faces to allow workers to rotate between development and mining, avoiding disruptions to the mill. He described the vein system as a structurally controlled quartz-carbonate vein system containing gold and silver, with lead, zinc, and copper also present in the concentrate. Noranda discovered the Boulder vein in 1985 while tracking soil zinc anomalies, and Blue Lake is extending along the same structure at depth and along strike.
Operations are based on a small footprint, with the portal, maintenance shop, dry room, and other facilities built close together on the mountainside. Mineralized material is hauled from underground and trucked approximately nine hours to Nicola's Merritt mill, where concentrate is purchased by Ocean Partners. Vig stated that transportation is feasible due to the high-grade ore, with costs equivalent to approximately half a gram of gold.
The exploration strategy involves more drilling on the main vein. A 2022 resource estimate showed 136,000 tonnes at 10.32 g/t gold in the indicated category, containing 45,000 ounces; 662,000 tonnes at 8.15 g/t gold in the indicated category, containing 173,000 ounces; and 85,000 tonnes at 6.02 g/t gold in the inferred category, containing 16,000 ounces. The estimate used a 3.5 g/t cut-off grade and only covered the Boulder vein system.
Blue Lake stated that resources can be increased by drilling between known intercepts, along strike, and at depth. Since acquiring Dome Mountain in 2020, the company has drilled approximately 50,000 meters, with the vein remaining open to the east, west, and down-dip. Past intercepts 150 meters below the known resource returned over 3 meters grading approximately 18 g/t gold. The company plans to drill one hole every 25 meters in some areas to support a resource update next year.
Vig stated that the company has deliberately resisted increasing its share count before obtaining permits. This restraint has kept shares outstanding at approximately 155 million. Major shareholders include Crescat Capital, Phoenix Gold Fund, Nicola Mining, and the Vig family. Offtake partner Ocean Partners agreed in May to purchase C$3 million in shares at C$0.90 per share, without warrants or discounts.
Dome Mountain is located on the traditional territory of the Babine Lake First Nation. A mural by a Babine Lake artist, depicting the nation's culture and clans, is installed at the mine portal. Vig stated that the company now incorporates the Yintah concept into mining meetings, with safety and Yintah discussed each morning. This relationship helped Dome Mountain win the Canadian Exploration and Developers Association's Sustainable Development Award in March, after the Babine Lake Chief nominated the company.
In addition to the Boulder vein, Blue Lake stated that Dome Mountain has 15 known high-grade veins, many sampled but undrilled, along with the Chance zone and other targets along an 18-kilometer strike. The company said less than 10% of the property has been subject to focused exploration.
This article is compiled by Wedoany. All AI citations must indicate the source as "Wedoany". If there is any infringement or other issues, please notify us promptly, and we will modify or delete it accordingly. Email: news@wedoany.com
