Winnemucca News

Allied Nevada Gold Corp. of Reno expects to begin producing gold from the Hycroft Mine west of Winnemucca in the next few weeks, and the company is considering expansion of the mine.

The company began mining ore this autumn as it completed repair and construction of processing facilities. The property 54 miles west of Winnemucca has been closed since 1998, when gold prices dipped below $300 an ounce.

In a filing with the Securities and Exchange Commission

Even as the company focuses on getting the mine back into production, Allied Nevada is studying the possibility of expanding the operation.

The thinking: The mine's processing facilities are large enough to handle a 30 percent increase in ore, so Allied's geologists have drilled 227 holes around the property in an exploration program that wrapped up in October. Results still are under study.

Expansion, which probably would cost less than $5 million, could begin in the third quarter of 2009 with higher production in place by 2010, the company said. Allied Nevada's board will make a decision in mid-2009.

The company last week reported a loss of $9.7 million for the third quarter as it continued spending on the resumption of mining but has yet to see any revenues from the work.

A year earlier, Allied Nevada posted a third quarter loss of $3.4 million. The company had nearly $33 million in cash available on Sept. 30 to continue its development of the mine and other projects.