THE BOURSE WHISPERER: Phoenix Gold (ASX: PXG) has reported development of Stage 1 of the Blue Funnel gold mine is meeting the company’s expectations.
Mining commenced at Blue Funnel in July and ore processing has now commenced under a toll milling arrangement with FMR Investments at its Greenfield’s Mill in Coolgardie.
The Board of Phoenix approved the Stage 1 development of the Blue Funnel mine in June.
The mine forms part of the Broads Dam project area, which is located on the Zuleika shear zone in the Western Australian Goldfields.
Phoenix tenements and Blue Funnel project and mill location. Source: Company announcement
“It is pleasing to report that mine development and operations for Blue Funnel are on track for a six to eight week processing program, which is a credit to the mining team and our local mining contractors,” Phoenix gold managing director Jon Price said in the company’s announcement to the Australian Securities Exchange.
“By commencing processing now we are leveraging off a strengthening Australian dollar gold price which provides us with the opportunity to increase our margins and deliver more cash into the business.”
Phoenix Gold said it expects the Blue Funnel project will deliver near term total net cash flow in excess of $3 million, based on a gold price of $1,350 per ounce.
The project required minimal start-up capital costs and has expected total cash costs of $981 per ounce of gold recovered.