PERTH (miningweekly.com) – A preliminary feasibility study (PFS) into the Tick Hill gold project, in Queensland, has estimated that the project could produce some 27 330 oz of gold over its 13-month mine life.

ASX-listed Carnaby Resources on Friday said that the PFS estimated that the project would generate pre-tax cash flows of some A$21.7-million, at an assumed gold price of A$2 300/oz, at an all-in sustaining cost of A$1 493/oz.

The study is based on an optimised openpit cutback of the existing Tick Hill openpit mine as well as the re-processing of the tailings dam and historic run-of-mine pad.

Carnaby has also reported a total maiden ore reserve estimate of 459 600 t, at 1.89 g/t gold for 28 000 oz of gold at Tick Hill, while a tailings and run-of-mine stockpile ore reserve of 410 900 t, at 1.35 g/t gold for 17 800 oz has also been estimated.

“The exceptional PFS results and maiden ore reserves announced today are another significant milestone on the way to transforming Carnaby from a junior explorer into a gold producer,” said MD Rob Watkins.

“The combination of a negligible capital startup cost from the low risk tailings stockpile reclamation followed by the 6 g/t gold Tick Hill openpit cutback, represents a unique opportunity to capitalise on high Australian dollar gold prices and a catalyst for rapid growth in the future.”

The PFS estimated a capital cost requirement of A$355 000.

Watkins said on Friday that an amendment to the existing environmental authority of the Tick Hill project is now under way, and it was anticipated that startup approvals would take three months to complete.

Third party processing options in the Mt Isa/Cloncurry district are being advanced, including discussions relating to potential contract mining and alliance agreements to negate any funding requirements of the pre-production capital.

First gold from Tick Hill is expected towards the end of the year.