PERTH (miningweekly.com) – Mining at the Ulysses gold project, in Western Australia, is on track to start next week, owner Genesis Minerals has reported.
Shareholders on Thursday approved a A$2.5-million share placement to mining contractor SMS Innovative Mining, allowing for openpit mining to start.
Under an agreement with SMS, Genesis will issue shares to SMS until full satisfaction of invoiced amounts, as per the mining schedule and agreed mining contract rates. Once the A$2.5-million threshold has been reached, all further invoiced amounts will be treated as an interest free loan to Genesis, which will continue to accrue until repaid out of cash flow.
First cash flow from the Ulysses mine is expected in early November, while first ore from the mine will be delivered to the 3.5-million Paddington gold plant by mid-October under a toll mining agreement with Paddington Gold.
The project is expected to generate a total free cash flow of around $6-million from the initial Ulysses West operation, based on a probable ore reserve of 74 000 t at 4.1 g/t gold for 9 700 contained ounces.
The cash flow will underpin a ramp-up in exploration activities at both Ulysses and the prospective Viking project.