Photo by: Bloombeg
PERTH (miningweekly.com) – Junior Kidman Resources has started openpit production at its Burbanks gold project, in Western Australia, marking a key milestone in the company’s efforts to become an Australian gold producer.
“This is an important event because it means Kidman is generating cash flow and it shows that we are delivering on the undertakings we have given to the market since acquiring the project in April,” said MD Martin Donohue.
The openpit operation would supplement current underground production and would provide Kidman with strong cash flow as the company continues to grow its gold inventory.
Ore from the openpit would be processed over the December quarter in conjunction with underground ore and, from early 2016, all ore processed would be sourced exclusively from the underground operation.
Donohue noted that while the openpit programme was relatively small, at only 4 552 oz, the additional cash flow it would generate over the next quarter would be substantial for Kidman as it transitioned to full production.
“This cash flow from the openpit will underpin further underground development and the extensive diamond drilling programme which will, in turn, generate the gold inventory needed to build a mine plan with production and cost forecasts for the Burbanks underground mine.
“Kidman will then have the foundations in place to be a significant gold miner with strong cash flow and exploration upside.”
Milling from the underground mine had also started and Kidman was expecting its first gold pour shortly.
Kidman recently announced an initial combined indicated and inferred mineral resource of 99 000 oz, at 5.6 g/t gold for the underground mine, and resource drilling had now progressed to grow this mineral inventory.