PERTH (miningweekly.com) – Gold miner Excelsior Gold would provide higher tonnages of ore from its Kalgoorlie North operation for processing at the Paddington mill, in Western Australia.
Excelsior currently had an ore treatment agreement in place with gold miner Norton Gold Fields, under which a minimum of 500 000 t/y of Excelsior’s ore would be treated at the Paddington mill, over the next five years.
First ore from the Kalgoorlie North project was hauled to the mill in December last year.
Also in December, the two companies entered into a letter of agreement to modify the terms of the ore treatment agreement to bring forward production, and to provide for Excelsior to make increased tonnage available to the Paddington mill through to the end of March.
However, Excelsior said on Wednesday that Norton Gold Fields had now requested that the higher processing rate of 650 000 t/y be extended throughout the entire 2016.
Under the modified terms of the ore agreement, the payment timetable included a 50% up-front payment to Excelsior, following the delivery of each ore batch and the deferral of haulage and treatment charges until the final recoverable gold content of each batch was determined from the detailed sampling and gold recovery procedures.
Payments to date for the initial four ore batches had reached about A$1.93-million.
Excelsior told shareholders that the increased milling throughput would enable the company to accelerate the development of the Zoroastrian Central openpit, and would require the earthmoving contractor to provide additional fleet to facilitate waste removal in the upper part of the larger pit.
The development of the Zoroastrian Extended and Pipeline South openpits would also be progressed to provide feed for the Paddington mill once mining at the Castleareagh, Jackorite and Big Blow South pits was completed in late February.