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HELENA - Montana Tunnels Mining has received one of the two go-aheads needed to expand its operation in Jefferson City.

The state Department of Environmental Quality last week issued its record of decision on the company's request to mine an additional 24 million to 28 million tons of ore laden with gold, silver, lead and zinc.

Montana Tunnels awaits a record of decision from the federal Bureau of Land Management before seeking investors to finance the expansion. BLM's Butte field manager, Rick Hotaling, said the agency's decision should be released early this week.

General manager Tim Smith said the the current pit, some 6,000 feet deep, will be mined out by the end of November.

The company has stockpiled 2 million tons of ore, enough to keep its milling operations busy until April. But several weeks ago, employees in the mining and maintenance areas of the site, nearly half the mine's 209 employees, were told they might be sent home with pay for two months at the end of November while the company awaits its permits and seeks $70 million to pay for the expansion.

Paying the employees not to work would be better than having to lay people off, then rehire when it's time to go back to work, Smith said.

The permits are nearly in hand, but Smith said it's still uncertain how the expansion will be paid for.

The mine, in operation since 1986, has been jointly owned since 2002 by Apollo Gold Corp. and Elkhorn Tunnels. The expansion will allow the mine to operate for another five years.

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