Name of the Project
Gruyere gold project.

Location
The project is located in the Yamarna greenstone belt, about 200 m east of Laverton, in Western Australia.

Client
The project is a joint venture (JV) between Australia’s Gold Road Resources and South Africa’s Gold Fields.

Gold Road and Gold Fields entered into a 50:50 JV over the Gruyere project in November 2016. The South Africa-based major paid A$350-million for its share in the project.

Project Description
A feasibility study on the Gruyere project has confirmed it as one of the longest-life, lowest-cost undeveloped gold deposits in the world, with an estimated mine life of 15 years.

The project has total proven and probable reserves of 91.6-million tonnes grading 1.2 g/t gold. The Gruyere JV also has granted mining leases over additional mineral resources at Central Bore and Attila-Alaric, which do not form a part of the Gruyere project feasibility study.

Development of the project is based on one large openpit mine and a conventional semiautogenous/ball mill circuit, gravity/carbon-in-leach plant, with throughput of 7.5-million tonnes of fresh ore a year and up to 8.8-million tonnes of oxide ore a year.

A mining contractor will undertake activities, with Gold Road providing technical and managerial direction.

The feasibility study proposes that the pit be mined in four stages. Stages 1 and 2 comprise two independent pits in the northern and southern ends of the deposit. Stage 3 will combine the two starter pits and Stage 4 will cut back to the final pit design.

Jobs to be Created
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value (NPV), at an 8% discount rate, of A$486 million and an internal rate of return (IRR) of 24% at a A$1 500/oz gold price. At a A$1 750/oz gold price, the NPV increases to A$910-million, with an IRR of 35%.

Value
The project has a forecast capital cost of A$532-million.

Duration
The project’s execution is based on a five-month early works programme, immediately followed by a 24-month construction and commissioning timeframe to achieve first gold production by the end of 2018.

Latest Developments
The capital cost of the Gruyere gold JV has increased from A$507-million to A$532-million, following an engineering, procurement and construction (EPC) review by the JV partners.

Since the JV was formed with South Africa’s Gold Fields, the partners have been working on a detailed review of the feasibility study, which has resulted in several improvements and enhancements to the project.

“We are very pleased with the continued improvements to the project, and after careful scrutiny, the capital cost estimate has been restrained within the feasibility study cost-estimate error range,” Gold Road MD and CEO Ian Murray has said.

The JV partners recently awarded a A$298-million EPC contract for the gold project, and have signed a A$585-million power supply contract with APA Group to design, build, own and operate a 198 km pipeline and a 45 MW gas-fired power station to support the project.

Contracts have also been awarded for long-lead items such as the primary crusher, and semiautogenous grinding and ball mills.

Key Contracts and Suppliers
Amec Foster Wheeler and Civmec (EPC) and APA Group (pipeline and gas-fired power station).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Gold Road Resources, tel +61 8 9200 1600, fax +61 8 9481 6405 or email perth@goldroad.com.au.