Toweranna Adding More Allure to De Grey’s Mallina

THE CONFERENCE CALLER: De Grey Mining (ASX: DEG) has reported “outstanding” intercepts from infill and extensional drilling at its Toweranna deposit, ahead of a presentation to the 2023 RIU Sydney Resources Round-up today. By Ngaire McDiarmid

Resource definition drilling results at Toweranna, the initial intrusion that led to De Grey’s large-scale Hemi discovery, included 2m at 64.2 grams per tonne gold, within 10m at 13.2g/t from 288m.

A highlight from drilling outside the existing resource was 41.5m at 4.7g/t gold from 12m.

Executive technical director Andy Beckwith said the results would be included in the definitive feasibility study underway, and the extensional results offered a longer-term new focus.

“That’s probably a structure on the margins of the intrusion,” he said.

“Now we want to try and track that around the deposit and along strike.”

Toweranna currently hosts a Mineral Resource of 525,000 ounces, part of the overall 10.6 million ounces at the Mallina project in WA’s north which De Grey is advancing towards production.

Mallina is expected to produce 540,000oz annually for the first 10 years, according to a 2022 prefeasibility study.

The PFS presented “compelling financial metrics” post-tax including undiscounted free cash flow of $4.2 billion, an internal rate of return of 41 per cent and a 1.8-year payback period.

The DFS is due mid-year.

Beckwith told Resources Roadhouse that test work showed Toweranna’s mineralisation could be optimised by ore sorting, which the company had been investigating “well before the Hemi discovery”.

He believed ore sorting could optimise the deposit – “it’s not needed to make it work” – and cited potential benefits, including reduced haulage, a higher-grade feed and improved financial metrics.

“The technology has leapt in the last five years and now, I think the benefits it can bring is going to be immense in the next 10 years,” he said.