Gold Road opts for smaller processing plant at Central Bore

THE BOURSE WHISPERER: Gold Road Resources (ASX: GOR) has conducted further ore processing studies on the company’s Central Bore project, located in Western Australia.

Gold Road said the latest studies confirm the viability of a smaller stand-alone high-grade underground mining operation at Central Bore than what had previously been identified in the Scoping Study the company completed in September last year.

The new operation will run on a one hundred thousand tonnes per annum (100ktpa) processing plant, as opposed to the 400ktpa in a conventional CIL plant with blended feed material from both the Central Bore underground mining operation and the lower-grade Attila and Alaric open pit mining operations originally suggested by the scoping study.

Gold Road conducted a review of the outcomes of the study, which highlighted the different operating costs of the underground mine versus the open pit mines, and the increased project and funding risk from including the relatively lower grade/higher cost open pit mining operations.

It then commissioned investigations into a smaller sized processing plant options fed only from the Central Bore underground mining operation for both the capital expenditure and operating expenditure requirements for the smaller 100ktpa modular processing plant.

The newly-crunched numbers ranged as:

–    Capital expenditure (process plant only): $18 to $20 million; and

–    Plant operating expenditure per tonne: $80 per tonne to $100 per tonne.

“The lower capital expenditure of the smaller stand-alone plant option compared to the original Scoping Study is very positive, and will result in a shorter payback period while maintaining the high return on investment,” Gold Road Resources chairman Ian Murray said in the company’s announcement to the Australian Securities Exchange.

“This option would allow us to expedite production with a much lower financing requirement, which is critical in the current capital market environment, and provides a solid platform for the finalisation of the Pre-feasibility study.”

 

Process Flowsheet. Source: Company announcement

 

The company indicated other potential benefits associated with the smaller modular plant to be:

–    Reduced plant construction lead times;

–    Smaller mining camp; and

–    Reduced environmental footprint.

Gold Road said it would use the new numbers in its Pre-feasibility Study, along with the revised Central Bore resource model, which will incorporate recent diamond drilling results.

The Pre-Feasibiliy Study is due for completion in the 2nd Quarter 2013.