A new gold-bearing vein system has been discovered at the Kensington mine, owner Coeur d'Alene Mines announced Wednesday.
Drill tests conducted at the end of last year show the vein structure, named the Kimberly, could develop into a major gold system, Coeur Senior Vice President Exploration Donald Birak said in a statement.
The tests represent a first phase of drilling, and more work needs to be done before the company can say how much additional gold the mine might produce or how the discovery might affect its life span.
The mine has 1.5 million ounces of gold reserves and an initial life of 12 and a half years.
The discovery was not unexpected at Kensington, since it's typical for companies to find additional ore through exploration, even after production has begun.
Coeur's tests showed eight of 14 total core holes drilled intersected "very significant gold mineralization," the company said, with assays ranging from 0.144 ounces per ton to more than 1.29 ounces per ton.
State Mine Coordinator Tom Crafford, with the Department of Natural Resources, said the numbers were a "pretty impressive" point from which the company could proceed with more exploration.
Grades of a tenth of an ounce are considered good, but reserves depend on additional factors such as the width of the vein and the cost of production.
Gold's value is extremely high, selling Wednesday for $1,108 an ounce.
The mine, located 45 miles northwest of Juneau, is under construction to finish a tailings disposal facility that had been contested but allowed to proceed after a U.S. Supreme Court ruling last year.
Tailings are the rock left over after ore is removed during the mining process.
Production is scheduled for later this year, estimated to be 120,000 ounces of gold annually.
News Wednesday of the discovery did not significantly impact the company's stock, which closed about 1 percent higher at $15.24 per share.
Contact reporter Kim Marquis at 523-2279 or by e-mail at email@example.com.