THE DRILL SERGEANT: Matsa Resources (ASX: MAT) reported results from a recently updated scoping study for the Fortitude Pit, at the company’s Lake Carey gold project in the Eastern Goldfields of Western Australia.
Matsa Resources said the study had determined the Fortitude Pit would produce a potential cash surplus of $95 million over an estimated mining period of four years based on Matsa’s proposed 600,000 tonnes per annum processing plant.
A sensitivity review was also carried out that indicated the project to be robust with potential for improvement from lower mining and processing costs by utilising a larger mining fleet and a bigger processing plant.
The revised optimisation has been driven by the recently announced revised Minerals Resources Estimate for Fortitude, which stands at 8,048,000 tonnes at 1.9 grams per tonne gold for 489,000 ounces and represents a 43 per cent increase in resource ounces from this time last year.
“This is a fantastic result, Lake Carey just keeps getting better and whilst more work will improve the economics of the Fortitude mine, on face value it alone now justifies the mill strategy,” Matsa Resources executive chairman Paul Poli said in the company’s ASX announcement.
“The Devon and Fortitude open pits alone could now provide collective positive cash flows of $140 to $150 million and with ongoing exploration in this great project, I’m very confident we can continue to build on this result.
“This study was completed using a gold price of $2,400 per ounce for the optimisation and the results have effectively doubled the mine life and gold production.
“What’s also really pleasing is that 95 per cent of the ounces in this bigger pit are in the Measured and Indicated categories.
“I’m also very confident we can improve on this projection with the lower cost structures you would expect from a larger mill than the 600,000 tonnes per annum currently envisaged and I expect the larger pit should also provide an improved scheduling and cost structure scenario.
“The exploration potential at Lake Carey is significant.
“Importantly, we’ve already commenced underground studies at Fortitude, if we can add an underground component to the Fortitude open pit this could be very interesting indeed.”
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