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ROUND MOUNTAIN — The Big Smoky Valley between the scenic Toiyabe and Toquima mountain ranges in central Nevada does not have many people living in it, but Round Mountain mine near the southern end of the valley has had some extra activity going on for the past year and a half as crews have worked on a mine expansion project. Kinross’ Round Mountain mine has approximately 845 employees, and during construction of their most recent expansion, the mine also employed up to 250 contractors at any given time.

The $445 million Phase W expansion project was announced in September 2017 and construction work started in the first quarter of 2018. There has been an aggressive schedule to reach the goal of finishing up the work in the second quarter of 2019. In May there was a hive of activity around the big new building being built to house the new truck shop and warehouse, with crews working on lots of aspects of the building construction all at once.

The new haul truck shop is 40,000 square feet and has 10 bays.

“All the construction is progressing quite well,” Kinross Round Mountain General Manager Neil Jensen said in early May. “We’re on track with the costs and schedule. It’s been a really good project. We’ve begun to commission some of the processing facilities here in the second quarter as planned.”

The new processing facilities include a new dedicated heap leach pad and a new vertical carbon-in-column plant which will process solution from the heap leach. They have been stacking ore on the new leach pad and have been circulating solution. In the mining area, they have been removing waste from the thick alluvium layer to get down to the ore.

Jensen said it looks like they will begin to produce some gold from the new section of the mine in the second quarter.

Round Mountain is a large open pit mine, and the Phase W expansion extends the pit into a deeper portion of the ore body. The current pit is 1,602 acres and approximately 1,200 feet deep. The Round Mountain plan boundary, including Phase W, encompasses 10,864 acres. Phase W only increased the footprint by 53 acres, since it is primarily within the historical footprint.

Prior to the project, Round Mountain’s mine life only went through 2019, but the Phase W expansion extends the mine life to 2027.

Once the new buildings are completed, the truck shop, warehouse and purchasing employees will move and the old buildings will be torn down to provide additional area for the Phase W mining.

“It’s going to be pretty nice to get back to normal operations,” Jensen said, “and be in those new facilities and get everybody reestablished in a normal routine and not be in a construction mode.”

Round Mountain history

“The Round Mountain Gold Mine is one of the more celebrated gold discoveries in the US,” according to the GoldRushNuggets.com website.

Geologists have found that the gold in the Round Mountain area is in the rim of an ancient collapsed caldera. In some places there are visible veins of gold in all kinds of impressive formations. These aren’t found very often anymore.

According to histories of Round Mountain, gold may have first been discovered there in 1905, and the following year things really got rolling with the discovery of high-grade gold ore. Soon Round Mountain was a town of hundreds of people, with saloons and mercantile stores and daily stage coach runs.

For about the next 60 years, miners traveled through underground tunnels to follow the rich gold veins. In 1977, the area was converted to a commercial open pit mine.

Through the years there have been a variety of joint ventures operating the Round Mountain mine. As Jensen remembers it, when he started there it was a three-way venture with Echo Bay Mines, Homestake Mining and Case, Pomeroy and Co. Homestake then bought out Case Pomeroy, making Homestake a 50 percent partner in the mine. Barrick later acquired Homestake, and the 50 percent partnership in Round Mountain.

In 2002 Kinross Gold merged with Echo Bay Mines and TVX Gold. Kinross acquired a 50 percent ownership interest in Round Mountain in 2003.

Newmont Gold was also involved in this complex ownership scenario in several ways, including a partial ownership of Echo Bay.

In January 2016, Kinross acquired Barrick’s 50 percent share of Round Mountain, making Kinross sole owner of the mine. At the same time, Kinross acquired partial ownership of the Bald Mountain mine south of the Ruby Mountains. In October 2018, Kinross acquired the remaining 50 percent of the Bald Mountain joint venture from Barrick.

“I think Kinross has been very dedicated to growing the Nevada assets,” Jensen said. “Kinross has been very happy with the performance of Round Mountain over the years. I think that can be confirmed by their purchase of the joint venture buyout. That was a really good indicator that they wanted to continue to invest in Nevada.”

“Kinross has had a pretty strong history in Nevada,” Jensen said. “It’s been a really good company to work for.”

In recent years Kinross has been the third-place company for gold production in Nevada. Now with Barrick and Newmont entering into the Nevada Gold Mines joint venture, Kinross will be in second place.

Production

Round Mountain produces fairly low-grade ore, and the majority of it goes to the dedicated heap leach facilities. There are four now, including the new one. The new heap leach pad is 9 million square feet, and will hold 65 million tons of ore when it is piled up to 250 feet.

About 25 to 30 percent of the production, generally the higher-grade ores, is processed through milling, which is primarily a gravity concentration circuit.

Round Mountain also has had a reusable leach pad circuit, which Jensen said is not a common piece of mine infrastructure. There have been some good aspects to this process, but with the extra cost of crushers and the rehandling of materials, the reusable pad circuit is being decommissioned.

There has been a lot of gold produced Round Mountain over the years. One history said that in the first 10 years of mining at the site, from 1906 to 1916, the value of the ore produced was a little over $3 million.

The current, more official accounting of the gold produced at the mine dates back to around the time Echo Bay began operating the mine in 1985. By 2006 the mine had produced a total of 10 million ounces of gold. In 2018 Round Mountain celebrated pouring the mine’s 15 millionth ounce of gold.

Models of three giant gold bars sitting outside the Round Mountain offices depict what 15 million ounces of gold would look like if was all poured into three five-million-ounce bars. The three bars would be very heavy and expensive if they were made out of real gold. They would weigh about 470 tons, and at today’s prices would cost about $19.3 billion.

The Phase W expansion is expected to increase the gold production at Round Mountain by 1.5 million ounces through the remaining life of the mine. The mine is projected to produce an average of 341,000 ounces of gold per year from 2018 through 2024. The stockpile milling and leaching from 2025 through 2027 is projected to produce an average of 46,000 ounces per year.

The silver production at Round Mountain is about 30 to 40 percent of the gold production.

Wall monitoring

Last fall, Round Mountain experienced a slide in the southwest portion of the pit wall. No employees were injured, and the event did not significantly impact production or the Phase W expansion project. Through the use of a radar monitoring system as well as a combination of geological and aerial data, the mine was closely monitoring and well aware of potential pit wall issues prior to the event.

As part of their mining operations, Round Mountain is working to move ore from the impacted area and continues to mine in other parts of the pit, including the Phase W expansion area.

The mine has a robotic laser system which builds complete measurements of the entire walls throughout the pit. Multiple radar systems, capable of detecting the slightest movement, continuously scan wall sections.

Veins of gold

The Round Mountain mine is world famous among gold nugget aficionados.

“Some of the gold crystals that have been found at the Round Mountain Mine are incredible,” says the raregoldnuggets.com website. “Some of the best specimens in the world come from this mine. They are extremely valuable and highly sought after by collectors.”

Do an internet search and you can find lot of pictures of impressive pieces of gold from Round Mountain in all kinds of configurations.

The Round Mountain offices have some display cabinets which include a variety of examples of gold from the mine.

“We bring a lot of educational groups through here, from fifth grade classes through PhD geology students, and they all seem to get a kick out of it,” said Emily Hendrickson, a corporate social responsibility specialist at Round Mountain.

“Listening to a geology presentation is pretty neat,” she said, “and learning about all the volcanic activity that went on for millions of years out here, and how that changed the land, and lets us do what we do today.”

Jensen said there is an intermittent vein structure throughout the mine.

“There are quite a few different kinds of specimens within those veins, real leafy gold, some of it’s real crystalline looking, and some of it is wire gold,” he said.

Jensen said Round Mountain specimen gold is included in geological exhibits at some universities.

In the past, Jensen said, the mine had a small gravity circuit which was used to recover coarse gold from the veins so that the specimen gold was preserved instead of just getting poured into a bar. The small gravity circuit is now decommissioned.

Jensen said they have not encountered any specimen gold at the mine lately.

“We anticipate getting back into the veins within the Phase W layback and possibly encountering specimen gold again,” Jensen said.

Cost efficiencies

Looking at the big pit at Round Mountain and the new Phase W extension of the pit, you can see the ore layer slope down toward the valley to the west. That means that there is more waste material to dig through to get the to ore in the Phase W area.

“That means the costs increase because of the need to strip more waste above the ore zone,” Jensen said. “So that’s the challenge. How do we continue to be economical and improve our efficiencies and reduce our costs to be able to do that next incremental piece of mining and add more ounces into the production plan?”

One step they took was a big push in 2015 to make sure they were achieving the proper payload in the haul trucks.

“That definitely improved our cost profile,” Jensen said. “Before, we had been underloading.”

The mine has had a fleet of Caterpillar 793C haul trucks which were commissioned in 2001. A lot of these trucks are still being used, but over the past couple of years, with the start of Phase W, the mine has commissioned 19 Caterpillar 793F trucks. These new trucks can climb a 10 percent grade in second gear. That reduces the haul time – although it can still take an hour or more to get from the bottom of the pit to the dump spot.

“That fleet has been very productive and has run quite well,” Jensen said of the Caterpillar 793F haul trucks.

As part of Phase W, the mine has also commissioned two Caterpillar 7495 rope shovels. One of the shovels was new and one was slightly used. They are 100-ton shovels, a lot bigger than the other shovels used at the mine.

“Those two are our primary loading fleet in the Phase W footprint,” Jensen said.

Most of the mine’s loading equipment needed six or seven passes to fill a haul truck. The largest shovel could fill a haul truck in five or six passes. The Caterpillar 7495 needs just three passes, since two and a half loads from the shovel fill the truck.

Jensen said Round Mountain has a very robust Continuous Improvement program. There are just a few people who are full time in the Continuous Improvement department, but the entire workforce is involved in the program.

“It’s a program we integrate into our business,” Jensen said. “There’s a working team that is constantly looking at how to improve the business and the site. I think a huge key to being able to keep Round Mountain going and being able to look at these expansions is that mentality of, ‘We always must improve to keep advancing the business.’ We can’t operate the site like we used to, even two years ago.”

Round Mountain culture

When I drove to Round Mountain for a mine tour, it seemed very, very remote, because I made the mistake of using a map on the internet to choose which road to take from Interstate 80 to Highway 50. I ended up on a small, rough gravel road, and for mile after mile I shared the road with cows but with no other vehicles.

From now on I will use a real map.

If you take the correct roads to get to Round Mountain it is not so difficult to get there, but it is still in a remote location. About 2,500 people live in the Big Smoky Valley area, which is about 1,300 square miles.

Some of the mines in Nevada are in a rural location that is somewhat close to a city, and a lot of the employees live in the city and commute over an hour to get to work.

Jensen said that some of the people who work at Round Mountain live in Tonopah, which is a 45 minute to one-hour drive away. Some have a home further away that they commute back to on days off. However, a lot of people who work at Round Mountain live in the small communities close to the mine.

“The quality of life, your work-life balance is a lot different than at a lot of the mines in northern Nevada, if that’s the decision you make, which is what I’ve done,” Jensen said. “I can be home in seven minutes. If I want to run down and watch my boy in a baseball game, I can do that.”

Because of the mine’s remote location, Kinross operates a day care, a grocery store, a small restaurant and a golf course in the Smoky Valley. Those businesses provide more opportunities for services and recreation for the employees and the Smoky Valley residents. Kinross employs about 40 people who work at these ancillary businesses.

Jensen said the rural location sometimes makes it difficult to find new employees who are willing to make the move. He said they are currently a little short of their goal for the number of employees at the mine.

Jensen said that although Kinross has a sizeable production from its Round Mountain and Bald Mountain sites, and Round Mountain is a medium to large site, “we have more of a small-mine culture and people focus.”

“Some people really like that,” Jensen said. “We’re a little unique … We engage the workforce and collaborate with them and try to incorporate a lot of their ideas into what we do.”

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