Northern Star increases gold resource at Ashburton project
THE DRILL SERGEANT: Northern Star Resources (ASX: NST) has increased resources at the company’s Ashburton gold project in Western Australia by 66 per cent.
The new Ashburton resource has come in at 21.3 million tonnes at 2.4 grams per tonne gold for 1.67 million ounces of gold.
Northern Star said the increased inventory underpins the company’s plan to establish a stand-alone operation at Ashburton.
Late last year Northern Star remodelled the geological structure of the project’s main Mt Olympus target to enable more effective targeting of its mineralisation.
Ashburton’s Main Deposit – 1.1 million ounce Mt Olympus gold deposit. Source: Company announcement
This resulted in a 350 metre down plunge extension to the Resource.
Northern Star said the enhanced understanding of the mineralisation it had gained is to be further evaluated when drilling resumes in the next Quarter.
The company also has a maiden sulphide reserve for Ashburton scheduled for completion in the second half of this year.
The Ashburton project is situated 200 kilometres from Northern Star’s Paulsens gold mine, the company recently completed a plant expansion that is expected to produce up to 115,000 ounces this calendar year, generating up to $85 million in surplus cash.
Economic and technical studies on the development of Ashburton are well advanced based on a two-staged strategy.
Stage One comprises an oxide project and Stage Two being based on a sulphide plant.
The updated resource includes 7.4 million tonnes of oxide ore grading 2.7g/t for 647,000 ounces and a further 13.9 million tonnes of sulphide ore grading 2.3g/t for 1.02 million ounces.
Northern Star explained commencing production at Ashburton as a free-milling operation, which it maintains will de-risk the subsequent establishment of a long life, high-grade sulphide operation and bring earlier cashflow.
Bill Beament said Ashburton was now a major deposit by any standard.
“To establish a 1.7 million ounce resource, with clear scope for further increases, is a great outcome anywhere in the world,” Northern Star managing director Bill Beament said in the company’s announcement to the Australian Securities Exchange.
“It is becoming increasingly clear that Ashburton will be another stand-alone operation with low costs and strong cashflow, giving Northern Star the project diversity and critical production mass being demanded by investors.”