Name and Location
Matilda gold project, Australia.

Client
Blackham Resources.

Project Description
The Matilda gold project has Joint Ore Reserves Committee-compliant mineral resources of 45-million tonnes grading 3.2g/t, and are all within a 20 km radius of the Wiluna gold plant. At least 21-million tonnes grading 3.4 g/t are in the indicated resource category.

A definitive feasibility study (DFS) on the project has confirmed the project’s robust economics, including a low capital requirement, short timeframe to production, fast payback and operating costs that are in line with its Western Australian peers.

During the DFS process, an additional two and half years have been added to the mine life from the prefeasibility study, which has resulted in a significant improvement in the project’s economics.

The DFS envisages mining at Matilda being undertaken by mining contractors, with management and technical services undertaken by Blackham personnel.

DFS mine designs have been completed on the main mining centres at Matilda, Galaxy, Williamson and Wiluna.

Openpit mining is planned for Matilda, Williamson and Galaxy and will all use a standard truck and excavator mining technique involving conventional drill, blast, load and haul. Ore will be hauled by road train to the Blackham’s Wiluna gold plant on existing haul roads. In addition to the mining fleet, an ancillary plant comprising tracked bulldozers, wheel loaders, graders and water carts will be required. The ancillary fleet will prepare drill-and-blast areas, maintain active digging areas, mine roads and waste dumps. Ore will be delivered to the run-of-mine (RoM) pad at the plant site by trucks and then fed to the treatment plant using an RoM loader.

The underground operations at Wiluna have been divided into three distinct areas. The Golden Age and Bulletin undergrounds will be accessed from the existing Bulletin portal and current Golden Age decline. The East West underground will also be accessed from existing underground infrastructure and portal access from East pit. Ore from the underground mines will be predominately extracted using top-down mechanised longhole open stoping and a bottom-up modified Avoca method, using unconsolidated backfill. Suitable pillars will remain to ensure ground stability during the mining. Ore is trucked to the surface and then hauled to the treatment plant. The majority of the underground ore is in the top 600 m and has a relatively short haul to surface.

The Wiluna gold plant has operated under several incarnations in the past three decades of operation, including as a carbon-in-pulp (CIP), carbon-in-leach (CIL) and, more recently, as a BIOX CIL enabling it to process refractory, sulphide ore using a smaller oxide (free milling) circuit. Blackham’s plan is to optimise existing plant components and upgrade the free milling oxide CIP plant to process
current resources.

The testwork and optimisation results showed the overall metallurgical performance achievable from Matilda will be 93% gold recovery, Williamson 95%, Golden Age 90% and Galaxy 94% for a weighted average of 93%.

The testwork also indicated overall recovery would be improved in most ores by adding a gravity circuit. The testwork also showed that leach times might be reduced through intensive oxygenation, which will also result in a reduction of reagent costs and stripping costs through higher carbon loadings.

During the DFS process, an additional two and half years have been added to the mine life from the prefeasibility study (PFS), which results in a significant improvement in the project’s economics.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 7% discount rate, of A$121-million and an internal rate of return of 102%, at a gold price of A$1 500, with a payback of 14 months.

At a gold price of A$1 600, the project has pretax net present value, at a 7% discount rate, of $170 and an internal rate of return of 150%, with a payback of 12 months.

At a gold price of A$1 700, the project has pretax net present value, at a 7% discount rate, of $219 and an internal rate of return of 211%, with a payback of nine months.

Value
The October 2015 PFS estimated that the project would require a capital investment of $28-million to deliver an average of 98 000 oz/y over a mine life of nearly five years. However, the DFS estimates that the project will require about $32-million to develop and could deliver yearly production of 101 000 oz/y over the first five years of a seven-year mine life, with the life-of-mine production
estimated at 668 000 oz.

Duration
Blackham is targeting production by the third quarter of 2016.

Latest Developments
None stated.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Blackham Resources, tel +61 8 9322 6418, fax +61 8 9322 6398 or email info@blackhamresources.com.au.