Name of the Project
Second Fortune gold project.

Location
The project is 220 km north-east of Kalgoorlie, in Western Australia.

Client
Exterra Resources.

Project Description
A feasibility study completed on the Second Fortune project has confirmed the potential for it to deliver strong financial returns for shareholders, based on developing a mine below the existing openpit and generating a sorted concentrate for toll treating.

Ore extraction using long-hole open stoping and pillar mining methods is planned. It is planned that the mine will be developed and stoped out in a top-down sequence, with mining panels retreated back towards the access crosscut. Backfilling of the stopes are not planned, with the exception of the upper stope directly adjacent to the portal. The grade of the ore stopes on each level will determine whether an intact rib pillar or a cemented rock-filled (CRF) rib pillar will be left between stoping panels to provide overall support to the hanging wall and footwall.

Provision has been made for two horizontal CRF sill pillars to provide additional regional support, and reduce the overall height of the open stopes, thereby reducing the velocity of rocks reporting to the drawpoints. It is planned that these pillars will be located at positions between one-third and two-thirds of the total depth of the operation, dividing the mining area into about 100 m vertical segments.

Exterra has elected to toll treat the Second Fortune ore rather than process on site. Toll treatment provides several advantages with respect to reducing predevelopment capital costs and development schedules. 

The project ore is of a high grade, with associated low volumes, which allows for the material to be efficiently hauled and treated externally.
The feasibility study envisages a life-of-mine (LoM) production target of 392 000 t grading 5.8 g/t gold for 73 000 oz of gold. When sorted, forecast LoM production of preconcentrates for haulage and treatment will amount to 198 000 t grading 11.4 g/t for about 71 000 oz of gold.

The project has an estimated mine life of two years, with significant resource potential at depth on the main lode and on the subsidiary hanging wall, footwall and west lodes.

Jobs to Be Created
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at an 8% discount rate, of $21.5-million and an internal rate of return of 133%, with a payback of
13 months.

Value
Capital expenditure is estimated at $7.2-million.

Duration
First gold production from dumps is targeted for the third quarter of 2017 and from underground from the fourth quarter of 2017.

Latest Developments
Based on the feasibility, Exterra will now work to secure financing to allow for mining to start in the third quarter of this year.
Meanwhile, all regulatory approvals for the project have been received to start project development.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Exterra Resources executive chairperson John Davis, tel +61 8 6315 1411 or email j.davis@exterraresources.com.au.