Name and Location
Batangas gold project, Manila, the Philippines.

Client
Red Mountain Mining.

Project Description
A scoping study has confirmed a strongly viable, low-capital and low-operating, initial gold mining and processing project.

The study is based on the openpit mining and carbon-in-leach processing of existing, high-grade resources, of which 90% are in the indicated mineral resource category.

Initial production is planned from the South West Breccia resources on the granted Lobo mining permit – a mineral production sharing agreement (MPSA), following which the higher-grade mining inventory from Kay Tanda West resources will be transported 15 km from the granted Archangel MPSA to the planned Lobo plant.

Low-grade mining inventory using a cutoff grade of 0.85 g/t of gold from the Kay Tanda West mine will be stockpiled. Metallurgical testing indicates that the two mining inventory resource types need to be processed at different grind sizes and leaching residence times for optimum recovery and cost.

Net Present Value/Internal Rate of Return
Not stated.

Value
Preproduction capital is estimated at $16.7-million.

Duration
The scoping study expects construction to start in the June quarter of 2015, and processing/gold production to start in the March quarter of 2016, subject to financing.

Latest Developments
Red Mountain has cut staff and tenements from its Batangas gold project, as the hunt for a strategic financing partner heats up. It is expected that the funding partner will assist in the completion of the feasibility studies, as well as provide project financing to fund the development of Batangas.

The company has reduced staff numbers at the Batangas project by about 25% and has relinquished or reduced exploration permits at its tenement base, which are not deemed prospective, or which are not required for the development of the Batangas project.

Red Mountain says that by significantly reducing its burn rate, it will be able to devote more discretionary funding to high impact exploration, adding that nonexecutive director fees have also been reduced in an effort to save costs.

A previously completed scoping study demonstrated the potential for a viable gold mining and processing project that could deliver about 90 000 oz of gold over a four-and-a-half-year mine life. However, a revised production schedule estimated that the project could deliver 100 000 oz of gold and 250 000 oz of silver over its 5.2-year mine life.

The company is now proceeding with the final phase of the definitive feasibility study, which has been targeted for completion, along with final mine permitting, for the first half of 2015.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Red Mountain Mining, tel +61 8 9226 5668, fax +61 8 9486 8616 or email info@redmm.com.au.