Minerals exploration and development company West Red Lake Gold Mines has restarted milling operations at the Madsen mine in Ontario, marking a significant step toward production as gold prices trade at record levels.

The Toronto-listed miner said the mill, which had been in dry shutdown for 28 months, resumed processing low-grade material on March 10 without operational issues. The facility will begin processing bulk sample material from Stope 1 next week as part of a staged restart.

"Turning on the Madsen mill to process the bulk sample was a very exciting moment for the entire West Red Lake Gold team, who have been working tirelessly in recent months as we push towards production," said president and CEO Shane Williams. 

"A smooth restart of this major piece of infrastructure reinforces that our level of preparation has translated into successful operational readiness ahead of initial production."

The company has ramped up underground development, with the pace increasing from 20 m/d in January to 23.8 m/d in February. The connection drift is now 94% complete, with only 84 m remaining, the company said. A diamond drill rig confirmed the alignment between the two advancing faces.

West Red Lake also inaugurated a new 114-person workforce accommodations facility, which is now housing workers. "We are very glad that we can hire 60% of our workforce locally, which supports Red Lake and enables workers to live at home," said VP of operations Hayley Halsall-Whitney.

In a separate development, the company has drawn an additional $7.5-million from the second tranche of its $35-million credit facility with Nebari Natural Resources Credit Fund II. The funds will support remaining capital costs for the mine restart and other corporate and exploration expenses. The facility carries a floating interest rate based on the three-month term SOFR plus 8%, with a floor rate of 4%.

The Madsen mine, located in the historic Red Lake gold district, is being positioned for a full restart as West Red Lake transitions from developer to producer. Gold prices have surged past $3 000/oz in recent weeks, creating a favourable environment for new production.