ASX-listed Horizon Minerals has tabled an updated mineral resource for the joint-ventured Penny’s Find gold project in Western Australia’s Eastern Goldfields as it eyes a start to toll ore processing from the high-grade gold asset in the March quarter next year. Following resource definition drilling by the Perth-based company, the satellite underground deposit now has an indicated and inferred resource ascribed to it of 250,000 tonnes going at an impressive average grade of 5.22 grams per tonne gold for 42,000 ounces of contained gold.
The revised resource estimate uses a relatively high lower-grade cut-off grade of 1.5 g/t.
It comes after an infill and extensional drilling campaign this year designed to firm up the resource category robustness of Penny’s Find as well as test for extensions along strike. The latter work encountered new mineralisation to the north.
Significantly, more than 83 per cent of the resource in terms of contained ounces has been elevated to the higher-confidence indicated classification.
According to management, the project – about 50km north-east of Kalgoorlie – represents an underground development and production opportunity that can generate early cash flows while the company advances the feasibility study that is running the numbers over its proposed longer-term Boorara gold processing hub about 15km east of Kalgoorlie.
Horizon plans to use the new resource model for Penny’s Find to calculate maiden underground ore reserves figures that it aims to release in the December quarter this year.
Geotechnical assessment is well advanced and confirmatory metallurgical testwork is almost finalised, the Perth-based company says.
Horizon recently executed the previously announced agreement to buy its 50 per cent interest in Penny’s Find from JV partner and ASX-listed Orminex for $1.5 million cash.
As part of the deal, Horizon was required to plough an additional $1 million into pre-development expenditure, which it has done.
Much of the spending went towards this year’s drilling programs comprising 21 reverse circulation and diamond holes for an aggregate coverage of about 4,800m to a vertical depth of 282m.
The two companies will now contribute to future project costs on a 50:50 basis.
Horizon says the JV has all the requisite statutory mining approvals in place for the development of the Penny’s Find underground mine to go ahead and has also entered into a toll treatment arrangement for ore processing and gold production, which is pencilled in to commence in the March 2022 quarter.
Once the Penny’s Find ore reserves study and economic evaluation have been completed, the company says the JV partners hope to make a development decision in the December quarter this year.
In the event the Penny’s Find satellite mine proceeds, toll processing of the underground ore will be undertaken by Golden Mile Milling at its Lakewood plant near Kalgoorlie.
According to Horizon, results from the recent drilling demonstrate continuity of width and grade and improve its geological confidence in the resource, with gold mineralisation open along strike to the north.
The Penny’s Find deposit also remains open at depth and will be further probed from underground drilling positions during the mining cycle, Horizon says.
Horizon Minerals Managing Director Jon Price said: “The JV partners have taken a very conservative approach with the new resource model and the latest drilling has provided increased confidence and higher JORC classification for reserve conversion. We now look forward to completing the updated underground mine optimisation and design for a development decision with our JV partners early in the December quarter.”
High-grade gold mineralisation at Penny’s Find occurs in thin quartz veins at the contact between footwall sediments including black shale and siltstone and a hanging wall basalt.
The quartz veins, which dip about 60 degrees to the north-east, collectively average 1m to 5m true width.
Open-pit mining at Penny’s Find was carried out by ASX-listed Empire Resources down to 85m three years ago culminating in the production of about 18,300 ounces of gold from the milling of 140,000 tonnes of ore that yielded an average grade of 4.47 g/t.
The depth from surface to the current vertical limit of the latest mineral resource estimate for Penny’s Find is about 270m.
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By Matt Birney
