PERTH (miningweekly.com) – Gold junior Silverlake Resources will spend A$18-million on exploration to quadruple gold resources at its Mount Monger and Murchison gold projects, in Western Australia.

The campaign aims to deliver a resource of five-million ounces for Mount Monger, within two years.

Speaking at a gold conference in Perth, Silverlake MD Les Davis said that while the project areas were enjoying both underground and openpit mining, strong conversion of resource to mineable ounces, and good brownfield discovery rates, there remained significant resource upside.

“Every dollar at Silverlake will be going into exploration as Mount Monger and Murchsion have low execution risk, the resources are available and the prospectivity is high on our underexplored tenement holdings there,” Davis said.

“The A$18-million will fund 115 km of drilling to achieve sustained production of 200 000 oz of gold by 2014.”

Mount Monger project is currently producing at a rate of 50 000 oz/y from the underground mining at an average of 40,5% g/t, and 10 000 oz/y at 3,5 g/t from the openpit. Ore is processed though Silverlake’s Lakewood mill, rejuvenated at a cost of A$4,1-million to double capacity to 600 000 t/y.

Silverlake has a targeted 2010 output of between 60 000 oz and 70 000 oz, achieving record monthly mine production in January this year of 8 400 oz.