PERTH (miningweekly.com) – Gold developer Pantoro has narrowed down a processing plant option for the Norseman gold project, in Western Australia.

The company on Tuesday said that it has completed a processing plant options review and scoping estimates for the Norseman project, which considered three options for the processing plant.

The review concluded that the existing leaching circuit was extensively corroded and, in addition to the large capital repair cost, would have a high operating cost due to the historical air operated Pachuca tanks in place.

As such, all of the options considered included a new leaching circuit using a modern mechanically agitated carbon-in-leach circuit.

Pantoro eliminated two of the options, following the review, as the first was A$10-million more expensive, and the other was noted to be higher risk from both a safety and financial perspective.

The option now being considered for the Norseman project consists of the reconstruction of the processing facility, with the same configuration at a new location, using a combination of refurbished existing major equipment and new structures, piping, electrical and services in a new location.

The cost for the refurbishment and rebuild has been estimated at around A$25.5-million, with construction time estimated to take some 33 weeks.

Pantoro will now complete design and cost estimations, the company said.

“The outcome of this study provides Pantoro with a clear way forward for reconstruction of the Norseman processing facility. The large amount of existing infrastructure at the site provides a major reduction in capital costs for the project and the review confirms our pre-acquisition cost assumptions,” said Pantoro MD Paul Cmrlec.

“We look forward to commencing the definitive plant design and cost calculation in the new year.”

Pantoro earlier this year acquired a 50% interest in the Central Norseman gold project for an initial A$10-million payment, along with A$20-million in Pantoro shares. A deferred cash payment of A$15-million will be payable 12 months after the completion of the transaction, and a further A$10-million on the 24-month anniversary of the transaction.

Pantoro would also be liable for the first A$50-million of project expenditure, with the vendor to be paid a 1% net smelter royalty on Pantoro’s attributable gold and silver produced from CNGP, capped at A$6-million, plus a 0.0025% royalty for a period of five years after the first A$6-million is paid.

A A$10-million milestone payment will also become payable on the definition of a 1.8-million-ounce Joint Ore Reserves Committee-compliant ore reserve.

The Central Norseman project has produced over 5.5-million ounces of gold since operations began in 1935, and the project includes a 720 000 t/y processing plant, which was last operational in 2016.