WINNEMUCCA — Hycroft's general manager, Warren Woods, was recently before the Humboldt County Commissioners outlining some of the big plans the company has for the future.

Woods said, “I'm here to update you on what we think is an exciting story going on at Hycroft.”

Going back to 2008, Woods noted Hycroft had about 140 employees and perhaps 3-years on the life of the mine. The company decided to do some drilling, explore the area a bit, and the results were promising.

Woods said, “The drilling happened. At first it increased our oxide mine life to five years, then seven years, then ten years, and now beyond that.”

In addition to gold, the company became interested in silver and sulfides.

Hycroft now has ten exploration rigs on the property and they've been there for most of the year. Woods said, “We probably have the most aggressive exploration program in the state.”

The company has big plans for the future that include an on-site expansion, which will require the company to purchases about $212 million over the next three years on equipment.

Expendutures like that are important to the local economy because they generate sales tax. As County Administrator Bill Deist noted, when those running the Ruby Pipeline project took delivery of their equipment they did so in Washoe or Clark Counties, so Humboldt County did not benefit from the purchase.

In outlining the money being spent on equipment purchases, Woods joked, “I'm not going to tell you we're diversifying the economy. We're certainly going to help the economy if we can.”

But the expansion also means jobs. Hycroft currently employs about 205 people, by the end of 2011 they anticipate that number will be 327 employees.

Hycroft's employment numbers could jump in a big way should they decide to build the big mill they've been talking about. Woods said they're looking at a 100,000 ton a day mill. If that project goes forward, the number of employees at Hycroft could jump to 500-600 people.

But that's down the road. Woods said he would have more information on the possible mill in the future.

Addressing the environmental side of the future of Hycroft was Debbie Lassiter, who is vice-president of environmental affairs. Lassiter told the commission the mine is working to update all their permits to support the operations that Woods outlined.

She said the mine has submitted a Plan of Operations to the BLM, which led to an EIS (Environmental Impact Statement). She explained the mine has been operating for quite a while and the existing permits are dated

Lassiter commented, “We're working really hard operationally and permitting wise to get everything up to current standards.”

Within the week Hycroft did an RFP (Request for Proposal) for potential contractors to complete the EIS. Lassiter said the contractor proposals are due back by Jan. 3 and they anticipate by mid January the notice of intent for the BLM to prepare the EIS will be listed on the Federal Register.

In addition, they're doing baseline studies on the wildlife, water, and everything that will require baseline studies for future expansion.

Lassiter commented, “Things are looking good for moving forward even beyond the EIS.”

Commissioner Tom Fransway asked the question on the minds of many: what happens if the price of gold drops.

Fransway asked, “I'm just wondering when you get it all set up and mining and going what is the minimum price of gold needed to sustain the operation?”

Woods said the current operating cash cost was $420/oz (ie: it cost about $420 to produce an ounce of gold) -- one of the lowest in the state.

Woods said the company anticipates the expansion will produce a lot more ounces, but they'll also be mining other minerals, such as silver, which have been ignored in the past.

“When we take a look at the gold portion of this we want to push it up to a half-million ounces a year,” he said. “When we do that cash cost will remain around $400/oz.”

Woods explained the time was right for the expansion, while gold prices remain high, so even if the price of gold drops – and it usually does at some point – they'll be able to sustain the mine.

Woods concluded, “A lot of us in our careers have ridden the wave of low-cost gold. It's fun to be surfing the tsunami.”