Navigator upgrades Bronzewing
THE BOURSE WHISPERER: Perth-based gold producer Navigator Resources has achieved a significant increase in the reportable Ore Reserve for the Cockburn gold deposit at the company’s the Bronzewing gold project.
The Open Pit Ore Reserve for the Cockburn gold deposit, which is part of Bronzewing, has been re-estimated following a recent upgrade in the Cockburn Open Pit Mineral Resource.
The Cockburn Open Pit Mineral Resource now consists of an Indicated Resource of 10.8 million tonnes at 1.6 grams per tonne gold containing 541,000 ounces of gold plus an Inferred Resource of 3.3 million tonnes at 1.4 grams per tonne gold containing 146,000 ounces of gold.
The Combined Mineral Resource now stands at 14.1Mt at 1.6g/t gold containing 687,000oz gold.
The new Probable Ore Reserve for Cockburn consists of 8.7Mt at 1.6g/t gold containing 438,000oz gold.
This Ore Reserve is contained within an open pit design that navigator had based on an optimised pit shell at $1,700 per ounce gold price using 100% of the Indicated and Inferred Resources.
The company also designed other optimised pit shells at $1,600, $1,800 and $2,000 per ounce to allow for gold price volatility.
Navigator opted to go with the A$1,700 per ounce pit shell as its preferred option for the construction of the ultimate pit design and associated Ore Reserve.
Navigator does not have to commit to the final pit cutback on the western side of Cockburn Pit for this new design for approximately six months.
The company said this will afford it flexibility for further optimisations and pit designs should the price of gold vary significantly.
The new Ore Reserve has already been depleted since the end of June 2011 due to the mining of approximately 55,000 tonnes at 1.5g/t gold to the end of August, as production at Cockburn ramps up to its full production capacity.
This upgrade in the Cockburn Open Pit Ore Reserve has arrived mainly due to the company being able to report tonnages and grades within a significantly higher priced pit shell that is $1,700 per ounce as opposed to its previous estimate at $1,250 per ounce.
The current gold price has allowed for the use of a lower cut-off grade of 0.5g/t gold compared to the 0.7g/t gold the company had previously applied, as well as an upgrade in the Cockburn Mineral Resource.
“Navigator has the benefit of considerable deeper drilling beneath the $1,250 per ounce Cockburn Pit design which demonstrates substantial additional mineralisation,” Navigator Resource managing director David Hatch said in the company’s announcement to the Australian Securities Exchange.
“With the recent increase in the gold price, the company has been able to move quickly to substantially increase the open pit Mineral Resource and Ore Reserve which has effectively added two years of mine life to the Bronzewing gold project based on the Indicated Resource only, or up to 2.5 years of extra mine life when including 70% of the Inferred Resource.
“We can now see the Cockburn Pit providing base load ore supply to the Bronzewing mill for around five years.”
In addition to the new Probable Ore Reserve based on the Indicated Resource, the new pit design contains an estimated 2.6Mt at 1.4g/t gold of Inferred Resource for 108,000oz of contained metal.
Navigator said that to date it had observed a 100% or better conversion rate of Inferred Resource with initial grade control programs.
However, it went on to say that it adopt a more prudent approach by applying a 70% conversion ratio to the Inferred Resource in its mine plan forecasts.