North Scotia resource upgrade and scoping study
show $15-20 Million cash surplus potential with
average grades of 6.8 to 7.3g/t.
• Mt Henry – Near surface resource scoping study add
further projected cash surplus potential of $12-30
Million.
According to that study, the current gold price of approximately
A$1,300/oz indicates that the project is
capable of producing a cash surplus of A$300
million, equating to an NPV of A$210 million
at a discount rate of 10%.
Small Scale Mining Operations Studies
As mentioned, two further scoping studies have
been initiated by the Company in order to
establish the potential for high grade gold
mining operations, utilising nearby milling
facilities.At Mt Henry the mining study show that Nodes
1&2 can be developed in two scenarios, which
take into account two or more, milling
scenarios. The low cost estimates show the
potential for 560,000 tonnes at 2.8g/t for
50,000 ounces of production with cash costs of
$660 per ounce. The high cost study shows
260,000 tonnes at 3.2g/t for 25,000 ounces of
production with cash costs of $730 per ounce.
At North Scotia the results from the scoping
study show between 90,000 and 120,000
tonnes production within open pit
optimisations at average grades of 6.8 to 7.3g/t
with cash operating costs estimated in the
range of $570 to $610 per ounce.
The Company has estimated the maximum
startup operational cash requirement to bring
the North Scotia Small Scale Mining operation
into production to be $1,000,000 including
$350,000 capital expense and a similar scenario
for Mount Henry.
Planned Activities
Activities in the next quarter will primarily focus
on work required to bring the North Scotia and
Mt Henry resources into production and
negotiate suitable terms for toll treatment at
third party facilities. This work will include
drilling to confirm resources and provide
metallurgical and geotechnical information.
Drilling activities commenced on the 21st of
April 2009.
