THE BOURSE WHISPERER: Bligh Resources (ASX: BGH) has received results of a preliminary scoping study recently completed at the Bundarra gold project in the Leonora region of Western Australia.
Bligh holds a 42.9 per cent interest in SR Mining, which owns 100 per cent of the Bundarra project.
The scoping study was carried out by independent consulting firm, CSA Global, which was commissioned to assess the development potential of the project.
“Bligh is pleased with the results of the initial scoping study at Bundarra, as it confirms that the project has robust economics and the potential to provide significant cash flow over a considerable mine life,” Bligh Resources chief executive officer Robert Benussi said in the company’s announcement to the Australian Securities Exchnage.
“This is the first study that has been conducted over all four deposits at Bundarra, and it outlines the potential for very early stage cash flow generation with $14 million in year one assuming a gold price of $1,600 per ounce, and importantly, the potential to process 2,000 ounces of gold at the base of the Celtic pit providing an immediate revenue stream.”
The Bundarra project consists of four deposits; Celtic, Wonder North, Great Western, and Bluebush.
Bligh proposes to establish a 250,000 tonnes per annum processing plant adjacent to the Wonder North deposit to treat the remnant resources, which the company expects to provide potential process feed of 2.3 million tonnes at 2.2 grams per tonne gold, recovering 156,000 ounces gold.
Oblique view of Wonder North pit shell. Source: Company announcement
Highlights of the study include:
– Confirmation there is development potential at the assumed gold prices;
– The scoping study was modelled on existing total JORC resource of 318,000 ounces at 2.1g/t gold, consisting of 136,000 ounces Measured and Indicated and 185,000 ounces Inferred;
– A mine life of nine years, at 250ktpa process feed;
– Cash costs for four deposits range from $886 to $1126 per ounce, averaging $1036 per ounce;
– Recovering grade controlled ore at the base of Celtic pit will provide about one month of mill feed, with $1,175 cash flow/recovered ounce at $1,600 per ounce;
– Stage One of the Wonder North pit provides the next highest value process feed at $742 cash flow/recovered ounce at $1,600 per ounce; and
– Significant exploration upside potential in and around existing deposits.
Bligh indicated is upcoming activities at Bundarra would include infill drilling to extend known mineralisation and JORC resource base, further metallurgical test work focused on the Bluebush and Great Western deposits, and advancing the project to feasibility stage.
“The company will now undertake further exploration works given the significant upside potential along strike and at depth across all four deposits,”
“The Board expects to increase the potential resource base and is assessing the optimal plant capacity and associated capital costs.” Benussi said.