SPARTAN RESOURCES LIMITED March 2nd, 2016
Australian Securities Exchange Limited Via Electronic Lodgement
57 139 522 900
- A 2.5Mtpa Process Plant has been designed and costed to an accuracy of +/- 25% as part of the Dalgaranga Gold Project PFS that is nearing completion.
- The design and flowsheet has been developed from recent and historical testwork and historical production records, reducing the development risk and uncertainty
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Cost estimates for the new plant and associated infrastructure confirm low capital costs for the project
- Process Plant Capital Cost $60.5M (inclusive of contingencies)
- Associated Infrastructure Costs $14.5M (inclusive of contingencies)
- Dalgaranga Gold Project Pre-Feasibility Study (PFS) is on track for March 2016 completion
Gascoyne Resources Limited ("Gascoyne" "the Company") (ASX:GCY) is pleased to announce that the preferred process plant design and flowsheet has been completed along with the capital cost estimate for the proposed gold processing plant and associated infrastructure at the Company's 80% owned Dalgaranga Gold project in the Murchison region of Western Australia (see Figure 1 & 2). Dalgaranga contains a recently upgraded (ASX announcement February 24th 2016)
Measured, Indicated and Inferred Resource of 23.7Mt @ 1.4 g/t gold for 1.05 million ounces of contained gold. The flowsheet, design and capital cost estimate has been completed by the engineering group Mintrex, which has been involved in the flowsheet development and plant design of some of the most successful gold project developments in Western Australia in recent years.
The design and flowsheet developed and costed by Mintrex as a key part of the Dalgaranga Pre-Feasibility Study (PFS), confirms the project will be a substantially lower cost development than a typical goldfields development of the same size due to a number of favourable characteristics of the project.
There are a number of characteristics of Dalgaranga that result in relatively low capital costs when compared to operations of a similar scale, including the soft nature of the ore. This results in a considerably lower installed power requirement that significantly reduces the capital cost.
Along with the soft ore, the gold is very easily liberated, resulting in a relatively coarse grind (106 µm) and rapid leaching. The existing tailings storage facility (TSF) can also be utilised, which reduces the pre-production capital as only a TSF lift is needed and not a whole new facility.
These attributes, when combined, result in a total saving of around $35-50 million when compared to a greenfields development containing hard ore requiring a fine grind.
Gascoyne's Managing Director Mr Mike Dunbar commented;
"Confirmation that the Dalgaranga Gold Project can be progressed with a relatively low capital cost is very welcome news. The deposits at Dalgaranga have a number of unique characteristics that Gascoyne and Mintrex have identified which will result in lower than normal capital and operating costs, including the very soft nature of the ore, the excellent metallurgical recoveries, rapid leaching and very low reagent consumptions. When combined these make a very substantial impact on the costs for development.
I would like to acknowledge the efforts of Mintrex and in particular Mr Ian Kerr and Mr Tom Kendall during the PFS and the way in which they have incorporated the highly detailed historical production data that we have acquired as well as the
P.O. Box 1449, West Perth, Western Australia 6872 Rust House, Level 2, 33 Ord Street, West Perth, Western Australia 6005 Telephone +61 8 9481 3434, Facsimile +61 8 9481 0411
Email: admin@gascoyneresources.com.au, Web: www.gascoyneresources.com.au
recent and historical metallurgical data. This information (and the interpretation of it) significantly de-risks the project and the engineering required for development.
The PFS, which is expected to result in a development case for ~ 100,000ozpa for around 6 years is nearing completion and is on track to be completed by the end of March."
A new 2.5Mtpa Processing Plant with a single stage crushing and single stage SAG milling flowsheet including gravity gold recovery and intensive leaching, classification, leaching and absorption tanks, elution, electrowinning and smelting (see Figures 3 to 5)
The Dalgaranga Process Plant flowsheet is broadly based on similar plant designs utilised at Regis Resources' Moolart Well Gold Project and Equigold's Bonikro Gold Project.
Existing Infrastructure will be used where possible and will be supplemented by new ancillary services.
The existing TSF will be used for the development and a wall lift has been allowed for in the capital cost.
Capital cost estimate has been completed and with an average contingency of 15% added to the estimate.
Process plant capital cost (including contingency) of $60.5 million.
Ancillary infrastructure capital cost (including contingency) of $14.5 million.
The working capital required for the development is still being prepared along with the mining schedule.
The Dalgaranga Gold Project Pre-Feasibility Study (PFS) is on schedule for completion by the end of March. The mining schedule is nearing completion, which will feed directly into the financial modelling of the project. It is expected that the project will produce around 100,000ozpa of gold with a mine life of around 6 years from the known resources.
In addition to the PFS, exploration is ongoing with followup drilling around the Hendricks discovery commencing next week along with further drilling at the Beefeater, Vickers, Gilbeys North, Gilbeys South and Caorunn prospects (see Figure 2). This drilling is expected to be completed by the end of March, with results expected to be received gradually from late March to mid April.
Additional information will be provided as it becomes available.
For further information please refer to the Company's website or contact the Company directly.
On behalf of the Board of Gascoyne Resources Ltd
Figure 1: Gascoyne Resources Project Locations in the Gascoyne and Murchison Regions
Figure 2: Plan of Dalgaranga Deposits and Prospect Location
Gascoyne Resources Ltd. issued this content on 02 March 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 02 March 2016 06:54:24 UTC
Original Document: http://www.gascoyneresources.com.au/assets/Uploads/160302-Dalgaranga-Capital-Cost.pdf
