THE BOURSE WHISPERER: Cleveland Mining Company (ASX: CDG) has commenced commercial mining and processing of ore at the Premier gold mine (50 per cent CDG) in central Brazil.
The Phase I gravity plant at the mine is currently operating at up to 40 tonne per hour.
Cleveland indicated it is now working on Phase 2, which will involve increasing throughput to 80tph and improving recoveries by adding a CIL circuit and second ball mill.
The company said it anticipates Phase 2 will produce around 40,000 ounce per annum, starting in 2013.
“Mining and crushing has continued over the past month and several more gold ingots were struck while commissioning the plant with historical tailings material,” Cleveland Mining managing director David Mendelawitz said in the company’s announcement to the Australian Securities Exchange.
“With ore now being processed, we are looking forward to the first commercial gold pour.
“Cleveland now joins the ranks of the few Australian companies that have commenced gold production in Brazil.
“The Company is looking to capitalise on this excellent start by increasing our resource base and production levels.”
With cash flows from the sale of gold imminent, Cleveland plans to kick off a drilling program in December 2012 or January 2013 with the aim of extending the Premier resource along strike, which currently remains open.
Drilling will also target the Premier Southern Zone, where extensive soil sampling, geophysics and limited drilling has shown promising results along the same structural trend from the Serra Grande Mine, which is located less than one kilometre away.
Over 5 million ounces of gold have been defined at Serra Grande and the same rock types and structures continue into Cleveland’s tenements.
Cleveland said work it has undertaken has demonstrated highly‐encouraging prospectivity for the company’s tenure in the Crixás Hub.
Located less than 1km from the Serra Grande Mine, Premier has excellent exploration potential. Source: Company announcement
The Premier gold mine is situated 270km North West of Brasilia, the capital of Brazil, and is immediately adjacent to AngloGold Ashanti’s Serra Grande gold mine, which has produced 3.4 million ounces of gold.
Cleveland claims its Premier project shares the same geology and low labour and power costs as Serra Grande.