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Scoping Studies
Preliminary scoping studies into an open pit mining operation have returned positive economic results. The study highlighted that 310,000 oz of gold is recoverable from a ‘starter’ open pit (5Mt of ore at 2.09 g/t gold) at an estimated operating cost of US$595/oz gold, resulting in a positive cash flow of +US$156million from the starter open pit using a gold price of US$1,100/oz.
The parameters applied in the open pit mining study were:
| Process plant throughput: | 1,000,000 tonnes per annum |
| Mining Cost: | US$2.50 per tonne |
| Mining Dilution: | 5% |
| Ore Recovery: | 95% |
| Processing Cost: | US$9.50 per tonne |
| Administration Cost: | US$1.50 per tonne |
| Royalty: | 1% |
| Gold Price: | US$1,100 per ounce |
The company anticipates that the addition of ounces to the resource base resultant from the completion of the present drilling program will result in further improvements in terms of economic returns. At present, the design of open pit shells are limited to the known extents of drilling, especially at the southeast end of the pit, where very high-grade mineralisation remains open at depth and immediately below the base of the conceptual open pit.
US$1,100 gold conceptual open pit (green) with resource block model (yellow and magenta denote very high grades
showing limits of current drilling and high grade zones below base of the conceptual open pit
Additional gold could be recovered from a subsequent underground mining operation and a conceptual underground mining study is presently in progress.