Posted: Aug 9, 2012 12:14 AM by Shannon Davis
Updated: Aug 9, 2012 8:58 AM
Roy Shipes, President and CEO of International Silver Inc., is waiting for the Butte-Silver Bow Council of Commissioners to grant him a proposal that would allow him to reintroduce underground mining in Butte.
Shipes currently owns 3,000 acres of land in the Butte mining district. One portion was previously owned by New Butte Mining. The other sits south of the Berkley Pit. Shipes said he is limited with how much he can do with the land because both portions are separated by nearly 1,000 acres of county land.
"There's veins that would run from our land to the south across the county land and into our land in the north," Shipes said.
Shipes proposed a sub-surface mining lease to the commissioners for the 1,000 acres of mining land. Beneath the surface Shipes said there are three zones he is interested in mining.
"It begins at the top of the ore body with lead-silver and then it transitions into zinc-silver, then it transitions into copper-silver," Shipes said. "There's a mixed zone between each of those transitions."
Each of these levels sit higher than the copper-silver level that was mined in previous years. Essentially miners were below three blocks of significant ore, according to Shipes.
"In total there are approximately 25 billion tons of ore," Shipes said.
Over the last 10 years the changing prices of metal have made this reserve even more substantial, Shipes said.
According to the U.S. Geological Survey, 2012 mineral commodity summaries, the demand for silver in industrial applications continues to increase.
The value and production of zinc however, saw a slight decrease in 2011. The total value for zinc mined domestically in 2011 was about $1.78 billion.
If the commissions grant Shipes his proposal he will recover the Kelly mine shaft. The ores that are recovered from this area and the rest of his property would then by hauled to one of two possible sites. One is the Badger mine shaft, which Shipes already owns.
"Or we would grind it there [Badger mine shaft] and pump it around behind Big Butte Mountain where we would put a mill and a tailing stem," Shipes said.
Shipes said because of the size of the mining operation it would be practical and cost effective to process the ores in Butte.
"Smelting copper is about a $100 per ton of concentrate and we can process it for $15 per ton of concentrate," Shipes said.
Initially this project would require extensive construction work creating between 350-400 jobs in the community. Once the operation is in full swing the mining will create nearly 200 jobs.
"And if we do build our own processing plant down-stream that would add another 50 jobs at least," Shipes said.
He is also willing to educate the Butte community anticipating there are not underground miners in Butte looking for work. Shipes said he wants to hire people from Butte if he can, and he is willing to give them the proper training.
This operation should not have an effect on the people of Butte, according to Shipes.
"It would be purely an underground operation," Shipes said.
Before any underground mining can be performed the mining shafts must be prepared. Shipes said his top priority is maintaining the historical value of each frame.
"We don't want to have any impact at all on the historical aspect of Butte, he said. "Everything would be underground, out of sight, out of mind."
Shipes expect his mining investment will cost more than $100 million.