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Westgold Resources Ltd.

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Summary

Project:

Meekatharra

Deposit:Paddys Flat
Location:Australia
Commodities:Gold
Date:1/29/2019
Report Code:JORC
Report Type:Exploration/Drilling Update
Project Stage:Active Mining & Production
Report details:29-1-2019: Westgold Resources Ltd. announces an Exploration/Drilling Update report for its Paddys Flat deposit at the Meekatharra project. Drilling results incl. 2.69m @ 139.7g/t Au from 49m. The December 2018 quarter witnessed steady group gold output wh
Resources:(not mentioned in this report)
CP/QP:[Overall Report]: Jake Russell (Internal)
ABSTRACT:The December 2018 quarter witnessed steady group gold output whilst at the same time significant progress was made in the growth of the Murchison Region gold operations. Overall cash costs (C1) reduced by 3% and group gold operational EBITDA (un-audited) increased by 51% respectively over the previous quarter. Fortnum Gold Operations (FGO) had a modest increases in gold output to 13,673 ounces and cash costs (C1) and AISC dropped by 16% and 14% respectively to A$1,100/oz and A$1,244/oz. Whilst underground ore production from Starlight was dominated by bulk low-grade remnant stopes, the mine did advance into virgin territory which should result in higher average mining grades going forward and increased gold output. Meekatharra Gold Operations (MGO) output was 8% lower at 23,416 ounces primarily due to delays in the onset of ore stoping at South Emu (which is now underway) and some short-term productivity issues at Paddy’s Flat. These were exacerbated by lower throughput due to ore hardness during the quarter. It is expected the secondary crushing circuit will be finalised by the end of April 2019 which will enable plant capacity to return to higher levels. The impact was a slightly higher cash cost (C1) for the quarter at A$1,288/oz. Cue Gold Operations (CGO) completed its third full quarter of gold output following the re-commissioning of the Tuckabianna Process Hub. The plant is running at full capacity and open pit mining at Day Dawn began to replace some of the lower grade tailings and stocks as a blended plant feed. The ramp-up in gold output continued with a 17% increase in gold output over the previous quarter to 14,676 ounces. Cash costs (C1) were $1,695/oz reflecting the lower grade ores in the depleted upper zones of the Day Dawn open pits. The Day Dawn pits fill the plant throughput whilst the Big Bell mine builds to full production over Calendar 2019. At Big Bell, the first ore was achieved from development in the newly defined (and additional) southern ore position. The new development (twin declines) to re-establish the previous sub-level cave mine will commence in April 2019 with coincidental ore being won from the new southern ore position. Big Bell will ramp to full output progressively over 2019. Higginsville Gold Operations (HGO) had 45% of its plant availability allocated to toll processing. Gold output at the plant increased to 15,781 ounces of which 7,482 ounces was attributable to third party toll processing. Quarterly cash costs (C1) and AISC reduced by 20% and 21% from the previous quarter to $1,426/oz and $1,570/oz. Westgold continues to review long term options for the project. Westgold used the rise in gold price during the quarter to re-structure its hedge book to a simple flat forward structure of 10,000 ounces per month at $1,776/oz for the next 15 months (150,000 ounces total). In addition, Westgold extended its gold pre-pay arrangement with Citi to 22,591 ounces bring forward a further $20.85m in funding which amortises at ~1,250 ounces per month.

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