Getting the lead out -- and the zinc

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buy this photo IR photo by <A href="mailto:John.Harrington@helenair.com">John Harrington</A> - Tim Smith, Montana Tunnels general manager, is shown on the mine's grounds.

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  • Getting the lead out -- and the zinc
  • Getting the lead out -- and the zinc
  • Getting the lead out -- and the zinc
  • Getting the lead out -- and the zinc

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Slowly, inexorably, one rail car at a time, a chunk of Jefferson County is being sent to Canada.

Montana Tunnels Mining was recognized this week with the Governor's Excellence in Exporting "Exporter of the Year" award, as one of the leading industrial exporters in the state.

Last year, the mine's exports of lead and zinc concentrate accounted for some $75 million in sales, or half of the state's total 2007 inorganic chemical exports (including ores, slag and ash) of $150 million.

Exports make up more than 95 percent of the mine's sales, with the balance accounted for in gold that's recovered locally and stays in the country.

"It's about just being recognized in general that we are a very large contributor to Montana's economic well-being," said Tim Smith, the mine's general manager. "We all love Montana, we love our hunting and fishing, and here we are contributing to Montana and being recognized for it instead of being painted as miners destroying everything. We have a good track record and we want to keep it that way."

Since 2002, the mine has been jointly owned by Apollo Gold Corp. and Elkhorn Tunnels. Since the mine came online in 1987, it has produced more than 1.5 million ounces of gold, 28 million ounces of silver, 390 million pounds of lead and more than 1 billion pounds of zinc.

On site, the mine processes the ore into lead concentrate and zinc concentrate, which are then sent to a smelter owned by Teck Cominco in Trail, British Columbia. (Some of the lead concentrate was once processed in East Helena, before the Asarco closure in 2001.)

The concentrates are driven by truck to a facility behind Wal-Mart, where they're loaded into rail cars that can carry 180,000 pounds apiece.

Last week, the mine shipped 14 covered rail cars of zinc concentrate, worth about $85,000 apiece, and four rail cars of lead concentrate, each worth about $300,000. (The lead concentrate includes most of the mine's silver and gold, hence the higher value.)

Add it all up, and the week's totals are about 3.24 million pounds of Jefferson County rock going to Canada, and $2.4 million coming back.

The mine employs around 208, with an annual payroll approaching $10 million. Some of the operation's other expenses are remarkable on an industrial scale: $1 million a month for diesel fuel. A power bill of $360,000 a month. Even tires for the Caterpillar trucks that haul ore from the pit are a huge line item, costing $23,000 apiece and adding up to a quarter-million a month.

Smith is hopeful the mine will soon receive the permit needed to expand to the west and remain in production through 2016. The process of securing the permit began four years ago.

Reporter John Harrington: 447-4080 or john.harrington@helenair.com.

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