PERTH (miningweekly.com) – Gold miner Red 5 is expecting to produce between 100 000 oz and 115 000 oz from its Western Australian operations in the 2019 financial year.
The company on Thursday announced a 64% increase to the reserve estimate at its Darlot mine, which now stands at 1.92-million tonnes, at 3.5 g/t gold, for 219 000 oz of gold, and a maiden ore reserve of 0.71-million tonnes, grading 3.9 g/t gold for 88 000 oz at its King of the Hills project.
The ore reserve estimate currently underpins a three-year mine life, with clear visibility to increase this through the conversion of additional resources into reserves, the miner said, as well as with new discoveries and potential bolt-on acquisitions in the region.
The mineral resource was currently estimated at 6.2-million tonnes, grading 4.8 g/t gold for 949 000 oz of contained gold, at Darlot, and a further 3.89-million tonnes, grading 5.3 g/t gold, for 658 000 oz of contained gold for King of the Hills.
“This is a tremendous result, with our Western Australian mineral resources increased by 24% and reserves by 133% in the nine months since Red 5 first gained ownership of the Darlot and King of the Hills projects,” said Red 5 MD Mark Williams.
“This ratifies our belief that there is still a significant amount of gold yet to be discovered within this highly prospective and underexplored region.”
Williams said that the rapid increase in the resource and reserve base in the Eastern Goldfields vindicated the company’s acquisition of the assets and its consolidation strategy in the region, which centers on establishing the Darlot gold mine as a regional processing hub to unlock new discoveries and potential bolt-on acquisitions in the region.
The production target for 2019 did not take into account any production from the Siana mine, in the Philippines, where Red 5 was granted clearance to construct and operate a tailings storage facility (TSF).
Operations at Siana were suspended in April last year following delays in receiving approvals for an amendment to the environmental compliance certificate to enable construction of the new TSF to proceed, along with uncertainty regarding regulatory and government mining policy in the Philippines.
Red 5 this week said that in light of the approvals, the company’s Philippine-affiliated company Greenstone Resources Corporation is now evaluating its preferred plan and options for the Siana gold project, including a revised mining strategy for the openpit operation, and required founding for the potential future restart of operations.