Classic Minerals is edging closer to cashflow after its mining license application for development of the near-surface Kat Gap gold project in WA cleared a major hurdle when Western Areas Ltd withdrew its objection to the application. Fresh from its successful $1.2 million placement earlier this week, Classic now has clear air to march on with planning to begin mining and gold production at Kat Gap next year.
The company’s confidence has been bolstered by the recent overwhelming response to its share issue, which was three times oversubscribed and a solid grab bag of developing projects across the gold-rich Forrestania greenstone belt in WA.
Classic’s current efforts remain focused on progressing through the regulatory process with Native Title and Mining Plan approval hurdles still to clear before it can start digging up the Kat Gap deposit and generate cash flow from gold production in 2021.
Classic Minerals Chairman, John Lester said: “Classic is very pleased to be able to report this important milestone…. it paves the way for the grant of a Mining Lease over the planned production area and is a critical development step for Kat Gap to become the next production asset for the company”.
The Kat Gap gold project is located 370km east of Perth in Western Australia and already boasts a resource of 975,722 tonnes grading 2.96 g/t gold for 92,856 ounces of contained gold. Recent drilling there returned a bevy of high-grade intercepts including 2m at 116 grams per tonne gold and 4m at 76 g/t gold including 1m at an incredible 304 g/t gold.
Kat Gap is 50km south of the company’s combined 311,050-ounce Lady Ada and Lady Magdalene deposits on the Southern Cross greenstone belt and just up the road from ASX-listed Western Areas Limited’s Forrestania Nickel deposit.
Western Areas originally objected to the registration of Classic’s mining tenement application on the grounds of potential issues regarding a fresh water supply pipeline running under Classic’s ground to supply its own mining operations.
After a study was completed, Classic said it was able to agree amicably with Western Areas that neither the pipeline nor Western Areas’ water supply would be affected by Classic’s future mining operations.
With a Global Mineral Resource of 8.24Mt at 1.52 g/t for 403,906oz of contained gold locked away in its vault, the management team of Classic Minerals is polishing up the documents for a number of major pre-production milestones expected to occur between now and February next year including the tabling of a PFS for Kat Gap.
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