Phoenix commences mining at Castle Hill

THE CONFERENCE CALLER: A company announcing the commencement of mining couldn’t choose a better time than day one of the Diggers & Dealers Conference.

Phoenix Gold (ASX: PXG) did just that with mining kicking off on schedule at the Kintore West open cut mine, part of the company’s Castle Hill Stage 2 project area on the Kunanalling shear zone, 55 kilometres northwest of Kalgoorlie.

 

Phoenix Castle Hill project area and mine location. Source: Company announcement

 

“It is a milestone event today for the company with the commencement of mining,” Phoenix Gold managing director Jon Price tole The Resources Roadhouse at Diggers & Dealers.

“We have been consolidating the tenure and growing the Resource over the last three and a half years.

“Now we are transitioning the business out of exploration into production.”

The initial stage of mining is anticipated to deliver 380,000 tonnes of mill feed grading 2.03 grams per tonne gold for 24,400 ounces mined and 891,000 tonnes of heap leach feed grading 0.6g/t gold for an additional 17,130 ounces mined.

Mill feed ore will be processed at FMR Investments’ Greenfields Mill under existing agreements with first gold production scheduled for early in the December Quarter.

“It is part of our stage development plan,” Price explained.

“We will start at Kintore West – we have a series of mines that will deliver 600,000 to 800,000 tonnes per year to the Greenfields Mill.

“That is what we call Prong One of our stage development plan.

“The second prong is working with Norton Gold Fields on the Castle Hill Stage 1 development.

“They have four days to make their decision – six months’ time-frame is up – and that has us developing a second stream of cash flow where they do the mining, the hauling and the milling and we get half of the cash surplus.”

The third prong of Phoenix’s plan is its agreement with St Ives Gold Mining Company to purchase its stand-alone 2.3 million tonnes per annum heap leach facility for $2 million.

“We’re looking at getting that up and running in 2015 and starting to deliver around 25,000 to 30,000 ounces of gold per annum.”

Email: info@phoenixgold.com.au

Website: www.phoenixgold.com.au