PERTH (miningweekly.com) - Gold miner Ramelius Resources has started mining at the Mount Magnet gold project, in Western Australia, after approving the project in April this year.

The first blast of waste material occurred on September 23, with mining now well under way, the ASX-listed Ramelius said.

The refurbishment works on the treatment plant were ongoing and due for completion during November this year. The cost of the refurbishment was set to increase from A$14-million to A$15.5-million, owing to a decision to replace the existing cyanide facility, and additional costs of refurbishment works on items that were not accessible during the original engineering assessment.

Gold production remained on track to start in January 2012.

Ramelius acquired the Mount Magnet project in July last year, for A$40-million, to complement the existing Wattle Dam underground operations. The project has previously produced in excess of five-million ounces of gold, and currently has an estimated mineral resource of more than one-million ounces of gold.

The project would produce a total of 520 000 oz of gold over an initial six years.

Meanwhile, Ramelius also reported that production from its Wattle Dam operations was expected to deliver some 16 000 oz of gold during the September quarter.

The mine produced some 25 000 oz of gold during the June quarter.

The production at the Wattle Dam mine was lower than the previous quarters owing to a number of factors, including a failure within the crushing circuit at the Burbanks mill, and milling of lower-grade development and other ore as the development of Block D continued.

Ramelius noted that although a higher crusher had been sourced, production would also be impacted in the December quarter as repairs were completed.

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