Blackham Resources managing director Bryan Dixon called into The Roadhouse this week on his way home from the company’s historic Matilda gold project.
The Matilda project has been a constant source of good news since Blackham acquired it in November last year hasn’t it?
It’s still early doors on the Matilda project as we are still really trying to get our heads around it.
We announced an initial Resource in January of around 600,000 ounces of gold, and then conducted RC drilling at the old Matilda mine, which confirmed that there appears to be plenty of ore left in there.
Four months down the track the resource has grown to 790,000oz of gold, with 630,000oz sitting in the two core deposits in Williamson and Regent.
Both these deposits sit on the Wiluna Mine Sequence that has produced four million ounces.
Blackham controls 40 kilometres of strike where we believe there’s a lot more ounces and potential for a hefty stand-alone operation.
Is Matilda where the company looks like focusing the bulk of its attention?
Of the three main deposits we have identified: Matilda, Regents and Williamsons – Matilda is probably the one requiring the most work, but it is also probably the one we could get into production the quickest.
M10 was the first deposit we drilled, which confirmed high grades starting from surface.
You referred to it as the ‘old’ Matilda mine. Could you tell us why?
The Matilda mine has previously been called Mt Wilkinson and Wiluna South and was operated by Chevron back in the late 1980s and then in the early 1990s by Eon Metals.
Around 160,000oz of gold was mined up until it was closed in 1992. So it has basically been on care and maintenance for 20 years, during which time it has seen very little drilling.
Back then ore grade cut-offs were 1.5 grams per tonne and the M1 and M2 pits ran close to 3g/t, whereas today ore grade cut-offs are closer to 0.5g/t.
You’ve been busy drilling since you acquired the project. What has that told you so far?
We’ve been drilling along strike from the old pits on the project and confirmed the mineralised bodies appear to be continuous.
Drilling in February this year. Source: Blackham Resources.
We anticipate releasing a Resource around those results in the coming months.
What about the Regent deposit?
Regent is a deposit that both Newmont and Agincourt had their reserves.
The last mining study carried out at Regents was in June 2006 when the gold price was fluctuating and they didn’t actually press the button to start mining.
Since acquiring Regents we have worked to validate the old data and everything has come up trumps so far.
We have increased that Resource up to 270,000oz and increased the grade by two grams to 2.2g/t.
We firmly believe Regents will be a mine as well.
You released the new Resource at Regent this week. What difference has that made to your thoughts for that particular deposit?
We have upgraded the Indicated Resource at Regents to 738,000 tonnes at 2.5g/t, which has also increased our confidence in the deposit.
Our next step there will be to carry out some mining scoping work.
Are you pleased with the way Regents is progressing?
Yes, Regents is going really well for us at this stage. Since that mining study was done by the previous owners the gold price has more than doubled – costs have gone up too, but nowhere near that extent – so the economics of Regents are far more favourable these days.
We are looking forward to completing a scoping study there as soon as possible.
Where is the next focus for your drilling?
We are very keen to get in and drill our largest deposit, Williamson. It historically produced about 40,000oz and still contains 364,000oz at 1.9g/t. We are eager to get in and drill below the old pit where we have seen intercepts up to 231g/t.
Does the project’s previous life provide any infrastructure on site?
The old Matilda site has a rehabilitated old plant site. If we were to construct our own plant, that’s where we would put it.
There is an old tailings dam too that would enable us to minimise our environmental footprint, making our environmental approvals quicker to achieve.
Are there any other options besides building your own plant?
There is the option of toll-treating up the road at the Wiluna gold plant. Matilda, Regents and Williamson all have haul roads in place leading back to that plant site.
What stage is Matilda at in the present state of play?
We have drilled an old site at Matilda called M10. Matilda was shut down quite abruptly 20 years ago, at which time they were still mining the M4 pit and the M5 pit.
One of the old Matilda mine pits. Source: Blackham Resources
The M10 pit had been cleared in preparation for mining, but they never got around to starting digging.
That was one of the obvious areas for us to target straight away and it emerged with some impressive grades that we were hitting from surface.
It must have been good to walk onto a project area that already had a number of identified targets?
It has made it a bit easier for us. There has been some 39,000 drill holes put down across the 600sqkm of this project area.
We have been focusing on the more developed areas with Resources, drilling along strike from those.
We are basically involved in a data mining exercise, which makes what we are trying to achieve significantly cheaper than drilling all those holes ourselves.
There is still a lot of work, however, involved in auditing and validating old data and ensuring its integrity.
Is all that data throwing up anything for you to chase?
There are numerous other prospects emerging, and we will eventually get around to them, but in the immediate future we will be focusing on the old mine sites.
The great thing about his project is that there are a number of ways we could develop it. It really all depends on our exploration success.
Is there a school of thought as to what would be your best option?
Depending on who you talk to, there are many different views on how we should go about it.
We could stand back and build up the ounces we have until we have a stand-alone project.
However, the great thing about the Matilda project is that we do have options and right now we really don’t need to make that decision.
We are focused on getting Matilda, Regents and Williamson mine-ready and then we can make the call of a stand-alone operation or whether we toll treat up the road down the track.
You’re almost at the magical one million ounce mark. Is that an important milestone?
It seems to be the point where people actually stand up and take notice of you.
When we acquired the project we knew we had 300,000oz, we now have close to 800,000oz grading close to 2g/t.
We believe we can get over the one million ounce mark in the near term and once we do we will reassess our goals.
We’re confident Matilda, Regents and Williamson will provide the one million ounces then we have a great deal of exploration potential lying beyond those initial targets.