Production slips at state's largest gold mine

Production and sales at the Fort Knox Gold Mine dipped slightly in the first two quarters of 2007.

The mine northeast of Fairbanks produced 176,644 ounces of gold over the first six months of the year for a decline of about 1.5 percent from the same period last year, according to preliminary figures released Aug. 2 by the Toronto-based Kinross Gold Corp., the parent company of Fairbanks Gold Mining Inc., which operates Fort Knox.

The mine earned $63.7 million in revenue in the second quarter of 2007, down 8 percent from the second quarter of 2006, as sales decreased nearly 13 percent from last year.

The mine has sold 169,221 ounces of gold so far this year, a 4.8 percent decline over the same period last year.

The downturn was attributed to declines in production and sales to lower throughput at the mill and lower grade ore.

Fairbanks Gold Mining is expanding into a seventh phase at the mine site and awaits federal permits for a 310-acre heap leaching facility that would use cyanide to economically recover gold dust from exceptionally low grade ore.

The mine received state permits for the facility in early July.

Fort Knox has produced nearly 3.5 million ounces of gold since it went into operation in late 1996.