Saracen updates Resources and Reserves
THE BOURSE WHISPERER: Australian mid-tier gold producer Saracen Mineral Holdings has completed an update of its JORC-compliant Mineral Resources and Ore Reserves statements.
The company has increased its total Resources (Measured, Indicated and Inferred) by ten per cent to 3.6 million ounces of gold.
The main contributor to the increase came from a 740% increase in the Butcher Well deposit resources taking it from 25,000 ounces to 221,000 ounces.
The company’s Ore Reserves decreased by 6.8% from 885,000 ounces to 825,000 ounces.
Saracen said however, that by taking mining depletion into account since its last published statement in August, Ore Reserves have actually increased by around 45,000 ounces.
Next month Saracen is scheduled to commence underground trial mining at its high-grade Red October project.
Red October is one of a number of underground development and resource definition programs the company has slated for 2012.
With a $25 million exploration budget to spend Saracen will also continue working on the Butcher Well area, located ten kilometres west of Red October.
“Saracen is fortunate to have such a resource base which could underpin our operation at Carosue Dam at current production rates for at least a decade,” Saracen Mineral Holdings executive chairman Guido Staltari said in the company’s announcement to the Australian Securities Exchange.
“The great opportunity in the next 12 months is to bring to book the underground potential at various deposits like Red October, Deep South, Whirling Dervish and Porphyry.
They currently represent a small part of our reserve inventory, but can make material differences by the nature of their higher grade, and lift our production profile towards 250,000 ounces per annum in coming years.”
Saracen’s total underground Mineral Resources currently stands at 4.3 million tonnes at 4.3 grams per tonne for 598,000 ounces of gold, with only 70,000 ounces (8%) from the Porphyry underground currently included in the Ore Reserves statement.
The deepest drilling undertaken so far across all of the resources is less than 400 metres below surface, with the $25 million exploration budget targeting extensions of high grade mineralisation up to 800m below surface, as well as a range of other greenfields and brownfields targets.
The company’s priorities for the $25m exploration budget 2011-2012 are:
– Extending existing resources at depth, targeting high grade mineralised zones;
– Conversion of existing resources into reserves (both open pit and underground);
– Underground diamond drilling at Red October targeting high grade extensions along strike and down dip of existing resource; and
– Greenfields exploration, primarily in the Lake Carey and Porphyry regional environs.
Saracen also intends using bulk samples from Red October for metallurgical response as well as an intensive drilling campaign to provide the basis for a proposed inaugural reserve estimate in 2012.