Gold Discovery Primes Gold Plant Purchase
THE INSIDE STORY: Kin Mining (ASX: KIN) grabbed market attention by discovering a new primary gold zone within the company’s 100 per cent-owned Leonora gold project (LGP) in Western Australia.
The LGP hosts a JORC 2012-compliant Indicated and Inferred gold Resource of 11.83 million tonnes at 1.9 grams per tonne gold for 721,000 ounces of gold contained within 17 separate gold deposits within three project areas: Mertondale (395,000oz), Cardinia (192,000oz), and Raeside (134,000oz).
Kin Mining’s gold producer aspirations were on display with the inking an Option to Purchase Agreement with Agnew Gold Mining Company to acquire the Lawlers processing facility.
The Lawlers plant will be relocated and upgraded to meet Kin’s processing requirements at the LGP.
It has a capacity of approximately 800,000 tonnes per annum and although having been decommissioned by Gold Fields it comes with a substantial inventory of spare parts.
The purchase includes the laboratory, warehouse, administration buildings along with plant design and construction drawings, which Kin said will save engineering costs and time.
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“The Lawlers processing plant option offers Kin a cost effective and rapid pathway to early gold production,” Kin Mining managing director Don Harper said.
The plant purchase came on the back of a recent 14 cent (62 per cent) jump in Kin’s share price after announcing multiple high-grade intersections had delineated a new primary gold zone at the Lewis deposit within the LGP.
The drilling identified a bedrock gold zone estimated to extend 500 metres along strike open to the north, south and at depth.
This zone of mineralisation was previously undetected because previous explorers had focused on the shallow supergene resources which dominate the Cardinia area.
“This is an outstanding discovery for Kin,” Harper said.
“The new zone of mineralisation is not only very high-grade, but it is also large, with every potential to grow significantly as we drill further along strike in both directions and deeper.
“In light of the high-grade primary zone discovery, the planned open pit designs will likely be deeper and larger than anticipated.
“We therefore plan to continue drilling and assess extending our Definitive Feasibility Study (DFS) to include the primary mineralisation.”
The Lewis discovery is important because the primary source of the extensive supergene resource at Cardinia appears to contain a high-grade component.
The high-grade bedrock intersections extend along strike for a least 500m, highlighting potential to define substantial resource ounces.
The discovery demonstrated potential to extend the newly-identified mineralisation as gold mineralisation intersections sit directly below the southern extent of a large plus-100,000-ounce supergene resource (Bruno-Lewis) that strikes 3km.
Kin has tested the target corridor for 500m to a maximum vertical depth of only 70m and sees no reason this abundant system shouldn’t continue at depth and along strike.
Kin has long-regarded Lewis as a development option for shallow free dig supergene ounces, and now believes the supergene resources at Lewis could represent the top of a large mineralised shear system, with potentially higher grade mineralisation at depth.
Kin was drilling Lewis for Resource definition of the supergene Mineral Resource, but with over 70 per cent of the drill holes not extending beyond 40m (35m true depth), the discovery of primary mineralisation beneath the supergene zone opened a new search space in the Cardinia area.
The company will commence follow-up drilling at Lewis shortly targeting both extensions to the known bedrock mineralisation and to test potential in the south of the Lewis area, where drilling has not extended beneath the depth of supergene mineralisation.
Kin is also reviewing the potential to target bedrock mineralisation to the north of the Lewis area, where supergene mineralisation continues for another 1.5km towards the Bruno deposit.
The Lewis discovery is located within the Cardinia area where recent drilling at Helens North and Helens South deposits had already consolidated earlier results at the Kyte, Rangoon, East Lynne, Fiona prospects.
“Drilling results to date have exceeded our expectations at Cardinia, with consistent shallow and high-grade successes,” Harper said.
“The ongoing drilling campaign continues to increase our confidence in the resource base of the LGP.
“We are on track to establish a strong maiden Ore Reserve which will underpin a larger 1.2 million tonnes per annum processing operation planned for Cardinia.”
Kin Mining NL (ASX: KIN)
…The Short Story
HEAD OFFICE
342 Scarborough Beach Road
Osborne Park
Western Australia 6017
Ph: +61 3 9242 2227
Email: info@kinmining.com.au
Web: www.kinmining.com.au
DIRECTORS
Trevor Dixon, Donovan Harper, David Sproule, Joe Graziano