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July - September 2022 Volume 1. Issue 148
$11.95
Registered by Australia Post PP 643938/00057


















































Gold Fields:








Flourishing in new pastures

















AFRICA IN FOCUS

Perseus, Firefinch, Mako

03
ISSN 1324-4396 439005 DIGGERS & DEALERS PREVIEW

Northern Star, Evolution,



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GOLD MINING JOURNAL (ISSN 1324-4396)
Published by Paydirt Media Pty Ltd.
A.C.N. 063 985 133

EDITORIAL
Editor:
Dominic Piper
Deputy editor:
Michael Washbourne

Journalist: nEWs 6
Fraser Palamara Northern Star Resources has unveiled mill expansion plans at the Kalgoorlie
Super Pit beyond the existing 13 mtpa, just a day after rival producer
Art director:
Nick Brown Evolution Mining shelved plans to increase capacity at its nearby Mungari
operations due to Western Australia’s tight labour market and surging
Contributors: inflation. Michael Washbourne reports on how Northern Star plans to use its
Keith Goode, “backyard” position to avoid any unwanted cost blowouts
Brendan Ryan (Johannesburg)
COvER 18
ADvERTIsIng
Advertising manager: While many of its peers continue to circle the M&A dancefloor, Gold Fields
Richa Fuller has pounced on Yamana Gold in a deal that will create the world’s third
largest gold miner by output and hand the Johannesburg-based company
Subscriptions: a long-coveted Americas portfolio. Dominic Piper speaks to Gold Fields
Vidy Suastika chief executive Chris Griffith about the acquisition and the important
foundations laid almost a decade ago when it swooped on a series of
PAyDIRT MEDIA unloved Australian operations
Executive chairman:
Bill Repard DIggERs & DEALERs 22
Finance manager: Gold mining executives, investors, analysts and more will return to the City of
Giovanny Jefferson Kalgoorlie-Boulder in early August for the annual Diggers & Diggers Mining
Forum with local governments in the wider Goldfields region very much in
Accounts/administration:
tune with the challenges facing the industry. As part of our special 30-page
Anjali Mediratta
preview to the three-day conference, we take a look at the gold explorers
COnfEREnCEs and miners looking to leave an impact on delegates, including site visits with
Christine Oelschlaeger emerging developers Musgrave Minerals and Medallion Metals
Angelique Julien
Melita Fogarty AfRICA 54
Paula Fujita Ahead of Africa Down Under in Perth from August 31 to September 2, we
provide a quick snapshot from some of the recent activity happening on
PRE-PREss AnD PRInTIng: the continent, including a maiden resource for Mako Gold and how the
Vanguard Press established West African producers are holding firm in a challenging market
26 John St, Northbridge WA 6003
Member of:





Cover image: Gold Fields chief executive Chris Griffith


COnTACT Us

Suite 9, 1297 Hay St, West Perth, p: (+61 8) 9321 0355
Western Australia 6005 f: (+61 8) 9321 0426
P.O. Box 1589, West Perth, e: [email protected]
Western Australia 6872 w: www.paydirt.com.au

EDITORIAL





It is definitively batten-


down-the-hatches time in


the Australian gold sector




by Dominic Piper




fter six years of unfettered success, the storm clouds Events last month brought the situation into stark relief. St
Awhich gathered over the course of 2021 are now raining Barbara and Evolution led the way (down that is) thanks to
down on producers of all sizes. production downgrades and cash cost blowouts.
Australian gold has enjoyed perhaps the most remarkable At the junior end, Dacian Gold Ltd suspended open pit mining
period since its very earliest days. Strong gold prices at its Jupiter mine in June and will stop underground activity
combined with visionary corporate leadership and operational this quarter as it struggles to reduce costs in the present
excellence to spawn a new generation of multibillion-dollar circumstances.
Australian gold companies widely recognised on the global Indeed, all the established miners took a considerable share
stage. price hit in the June quarter, from Newcrest Mining Ltd (down
Viewing the share registers of Northern Star Resources Ltd, 19%), to Northern Star (31.6%), Silver Lake Resources
Evolution Mining Ltd, St Barbara Ltd and Regis Resources Ltd (37.33%), Ramelius Resources Ltd (37.9%), Evolution
Ltd, you could be forgiven for thinking they were North (40.5%) and St Barbara (42%).
American companies, such is the international flavour of the For the mid-tiers, tightening margins at home have been
investor base. compounded by operational problems abroad. Newcrest,
Those investors were attracted to the Australian gold miners Northern Star, Evolution and St Barbara all spent big on North
precisely because they weren’t North American. Generalist American operations in recent years but are yet to see any
and even specialist investors had lost faith in the gold discernible return from their investments.
companies of the TSX and NYSE at the beginning of last These offshore ventures may one day be viewed as the
decade when they frittered away the record revenues in Australian gold industry’s Icarus moment or, they could
pursuit of a “big is beautiful” growth policy. actually be the light which guide them through the darkness
In contrast, the emerging Australian miners stuck to what of the next few years.
they knew and concentrated on low-cost ounces and reserve If – and admittedly that is a bolded, italicised and underlined
replacement to produce several years of free cash growth. if – they can get these mines on a strong operational footing,
They were aided by a flat Australian dollar which pushed the they may provide a balance to the next major impact likely to
domestic gold price to unchartered territory beyond $2,500/ strike the Australian sector; a rising Australian dollar.
oz.
As Sean Russo of Noah’s Rule points out in this issue,
Those levels remain but the last 18 months have seen cash the Australian dollar usually moves with the US gold price.
costs first creep and then catapult up, slicing through margins. However, in the current climate, the Australian dollar remains
The circumstances have largely been outside the gold historically low, sending the Australian gold price to record
miners’ control. The pandemic has placed massive stress on highs.
labour markets and supply chains, while recent inflationary The last time the gold price touched $US2,000/oz, the
pressures have seen oil and other material inputs skyrocket. Australian dollar was at or above parity. If it was to return to
If the dual blows of labour shortages and fuel increases that trend, the domestic gold industry could be in real trouble
weren’t enough it now appears the international investors with costs quickly outstripping the Australian gold price.
are ready to look for new investments after years of enjoying In those circumstances, the North American assets which
Australia’s wide operating margins and abundant free cash have so far failed to deliver could suddenly look very attractive,
flow. as would any other US or euro-denominated operation.






[email protected] @Paydirt_Media @paydirtmedia @PaydirtMediaAustralia


Page 4

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NEWS



Northern Star eyes




Super Pit expansion




by Michael Washbourne



orthern Star Resources Ltd is confident it can execute a Stuart Tonkin
Ncirca $1 billion expansion of the mill at the Kalgoorlie Super
Pit despite Western Australia’s tight labour market and surging “Interestingly, when we look at the numbers...if you took like-for-
inflation raising fears about potential cost blowouts. like and year-on-year, some of the things we bought and have
used for Thunderbox can almost have double the lead time and
Only 24 hours after rival gold producer Evolution Mining
40% extra cost for the same thing, so that’s what is reflected in
Ltd shelved plans for a mill expansion at its nearby Mungari
these costs.
operations, Northern Star presented three options to increase
the current 13 mtpa capacity of the 35-year-old processing “You can absolutely lock in and secure known lead times, known
facility following an exhaustive PFS process. prices and de-risk those things, but it’s like putting an extension
on your house or putting in a new swimming pool – you have to
Northern Star managing director Stuart Tonkin said the
decide whether you want to pay that price in today’s terms and
company’s preferred option was to undertake a 70%
whether you think it’s going to come off.
refurbishment of the plant and to boost milling capacity to 24
mtpa, rather than a bolt-on expansion which would lift throughput “We’re very confident from the execution phase that we have the
to 17 mtpa or build an entirely new 22 mtpa facility. depth and the capability to do it. At the end of the day, it’s only
10% of our current business activity, whether it’s in expenditure
Assuming a conservative gold price of $2,250/oz, the PFS
or in added labour, so relative to what we’re doing and managing
estimated a capex for the three options ranging from $440
every day of the week, it’s very manageable for Northern Star.
million to $1.4 billion, generating an IRR of 13-26% and payback
in 3-5 years. IRR improves to 16-31% when using the $2,600/ “The fact it’s in our own backyard in the City of Kalgoorlie-
oz spot price. Boulder de-risks it even further.”
All options incorporate production growth of 100,000-200,000 Northern Star is now embarking on final feasibility study to
ozpa and AISC reduction of up to $200/oz. settle on the best option for expansion, although maintaining
the current 13 mtpa milling capacity is a serious consideration.
Tonkin said the company would be unable to make a “step-
change” in its cost base if no expansion occurs.
“It’s a 35-year-old plant, it’s been maintained as best it can to
keep it going, there’s no significant material replacement costs
associated with that, but we budget a continual replenishment
and keeping the reliability in the infrastructure that’s there,” he
said.
“Without replacing it or simplifying it and making fewer larger
parts, we can’t structurally change the cost base. It’s embedded
currently in our sustaining capital, but for us to really make a
The Kalgoorlie Super Pit produced 472,000oz gold at step-change in the cost base, we need to replace and make
$1,385/oz in FY2021 fewer larger single parts.”

Regardless of the outcome of the final feasibility study, Northern
Northern Star managing director Stuart Tonkin said the
Star still plans to grow production at the Super Pit to 650,000
company had factored in the current high costs associated with
ozpa by FY2026. The famed Kalgoorlie mine churned out
any project development in WA, with actual numbers from the
472,000oz gold at $1,385/oz in FY2021.
recent mill expansion at its Thunderbox operations also serving
Since completing its merger with former 50% JV partner Saracen
as a helpful guide.
Mineral Holdings in February last year, Northern Star has more
“We took that [Thunderbox] from 3 mtpa to 6 mtpa, we’re
than doubled material movements at the Super Pit to 65 mtpa
essentially 95% complete on that, so in the same environment
(in line with the growth pathway to 80-100 mtpa) and increased
we’ve been able to do that on time on budget,” Tonkin said on a
underground resources and reserves at both Fimiston (5 moz)
conference call to discuss the Super Pit expansion plans.
and Mt Charlotte (1.2 moz) respectively.
Page 6



NEWS Novo intends to resume production at
Beatons Creek within 12-18 months

















Novo far from up the creek





by Michael Washbourne




ovo Resources Corp executive co-chairman Mike is completed. Best results received to the end of May included
NSpreadborough says the decision to wind down production 3.5m @ 43.62 g/t gold from 47m, 5.5m @ 16.02 g/t gold from
at its Beatons Creek gold project over this quarter should not 30m and 1.5m @ 48.84 g/t gold from 47.5m.
have come as a surprise to the market given the company Spreadborough said drilling completed to date had proven the
flagged the end of oxide mining late last year. fresh material was more consistent, thicker and higher grade
Shares in TSX-listed Novo tumbled 26% on June 14 when it than what Novo has recently been mining and processing via
was confirmed mining at Beatons Creek would cease by the the Golden Eagle plant.
end of the month, although processing of low-grade stockpiles Novo’s feasibility study on the fresh material is expected to be
will continue through until October, delivering up to 12,000oz completed midway through the December quarter, with the
more gold before operations move into care-and-maintenance. approvals process running in parallel.
Novo’s announcement was seen as the first of two major blows “We’re still waiting on EPA’s assessment of what they believe
for the WA gold sector given Dacian Gold Ltd subsequently is the appropriate approvals pathway,” Spreadborough said.
suspended mining at its Mt Morgans operations near Laverton.
“It can take up to 12-18 months for approval, depending on
Spreadborough was hopeful the production pause would which pathway, so that’s the long-lead path but whilst all of
last no more than 12-18 months with Novo now undertaking that is happening, we’re doing our very best to optimise and
feasibility work and seeking approval to transition to mining de-risk the fresh project so that we can start it up and deliver
and processing of fresh material at Beatons Creek. on the outcomes.”
“We announced to the market late last year that the gold grades Novo picked up the Golden Eagle processing plant as part of its
weren’t as we expected out of the Beatons Creek oxide project acquisition of former ASX-listed producer Millennium Minerals,
and on the back of the optimisation work we completed, we which entered administration in 2019 after encountering one
flagged that production would finish up this year,” he told GMJ. too many setbacks at its longstanding Nullagine operations.
“It shouldn’t have been a surprise given what we said back Despite his company’s recent decision to pause production,
in December, but obviously some people just misunderstood Spreadborough said the Millennium purchase was still
that. Back then we had expectations we could move from vindicated.
the oxide to the fresh material, which is a free-milling fresh
“We took control of a very good processing plant, infrastructure,
resource, but that hasn’t come to fruition because we don’t
village, camp, all of those things, which enabled a very, very
have approvals to mine the fresh material, so we’ve now got a
quick pathway into production for Beatons Creek,” he said.
gap in production.
“We are busy doing drilling on the oxide to see if there’s any
“We’re focused on a pause, which we hope will be no more than
additional oxide in Mosquito Creek, which is part of the old
12 months but we have said to people it will be 12-18 months.
Millennium ground, and we are also focusing on the sulphide.
It’s really a pause to drive development of the fresh…but it is
That will require a processing plant expansion, but we’ve got
important to note that doesn’t all kick in until October. We are
five years to deliver something in parallel.”
still running production until the end of September and then
Spreadborough said the TSX remained a “very strong”
we have a bit of gold drawdown in October, so we’ve still got
supporter of the Novo business but did not rule out a future
another quarter of production to come out of the operations.”
listing on the ASX. The company’s register currently boasts
A resource update for the fresh material at Beatons Creek
the likes of Eric Sprott, Creasy Group, Sumitomo Corp, Agnico
is due in late July or early August, with Novo committed to
Eagle Mines Ltd and Newmont Corp.
further upgrades later this year and into 2023 as more drilling
Page 8

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NEWS


No blessings for




St Barbara, Evolution




by Fraser Palamara and Michael Washbourne
Craig Jetson

id-tier producers Evolution Mining Ltd and St Barbara Ltd oz, 160,000 ozpa gold production, $US170 million in capital
Menter FY2023 severely bruised after being whacked by expenditure, a post-tax NPV of $US220 million, post-tax IRR of
investors for downgrading production guidance and shelving 40% realised after three years and a mine life of 11 years.
long-awaited development and expansion plans in the wake of But contractions and turbulence in the gold and services markets
rising cost concerns across the sector. had left St Barbara no longer feeling confident in keeping the
Evolution shares plummeted more than 26% in the week works within previously estimated cost guidance.
following its announcement that it would not meet annual “St Barbara faces capital investments at each of its three
production guidance for the first time in its 11-year history. Group operations in the next two years,” a market announcement from
output was expected to be 640,000oz, at least 30,000oz short of June read. “This strategic review will assess the best allocation
the lower end of guidance. of capital for risk and return compared with the company’s other
The Jake Klein-chaired miner has lost more than 40% of its projects.
value since the start of the year when it boldly declared group “St Barbara has received unsolicited enquiries from potential
production could soar to 950,000oz by the end of FY2024. investors in Simberi and anticipates the Sulphide Expansion
Evolution has also aborted plans to expand milling operations project to proceed either under St Barbara or different
at Mungari in Western Australia, less than 12 months after the ownership.”
company acquired Northern Star Resources Ltd’s neighbouring Simberi is joined in the company portfolio by the Gwalia mine
Kundana projects. in Western Australia and the Touquoy mine in Nova Scotia, the
Klein said the focus would now turn to optimising the existing 2 latter of which has faced its own problems lately.
mtpa facility at Mungari. St Barbara has been chasing permitting to convert the Touquoy
“Labour market conditions in WA have been challenging and open pit into a tailings management facility (TMF) since
disruptive at Mungari,” Klein said on a conference call to explain 2020 but the miner now claims the Nova Scotia Department
the company’s decision to shelve the expansion. of Environment and Climate Change has asked for further
“It does feel like we are back to the boom-time prices when clarification of the works.
commodity prices last peaked in 2011. In our view, these The company said it promptly responded to the Government
conditions are not sustainable.” but the request has impacted expected timeframes, placing “the
Meanwhile, shares in St Barbara fell business continuity at risk”.
to a seven-year low of 77c having Touquoy’s present TMF has capacity
placed expansion plans for its Simberi until mid-September and St Barbara
operations in Papua New Guinea under management has conceded the
strategic review. The company’s stock construction work on the in-pit tailings
has also drifted almost 50% since the infrastructure will now be unable to meet
start of January. completion in time.
St Barbara had been working towards St Barbara’s proposed fix is to raise the
FID for the Simberi sulphide expansions existing TMF wall in the interim, costing
project but suddenly deferred all plans roughly $6 million, and is working
in late June, citing a “volatile pricing “closely” with provincial regulators to do
environment” and inflationary cost so. A decision on this permit is expected
pressures on the global construction for early August.
Jake Klein
market. PNG’s Minister for Environment If the permit is not secured in time, St
and Conservation and Climate Change Barbara will likely put the operation on
had already signed off on the works and care-and-maintenance.
the Conservation & Environmental Protection Authority was
St Barbara’s FY22 Q3 report at the end of March showed gold
expected to shortly follow.
production had decreased from 82,000oz to 62,000oz on the
An April feasibility study on the sulphide expansions forecast year, the third successive quarter of production falls.
$US13 million in pre-investment costs, AISC of $US896/


Page 10

Managing director Craig Jetson, who stepped into his role in Despite the production downgrade for FY2022, Evolution still
2020, cited skills shortages and the pandemic as major factors expects its Ernest Henry mine in Queensland to deliver more
in the decreased production. than $400 million in cash flow.
“Our Leonora operations were impacted by ongoing skilled “Our portfolio is well positioned,” Klein said. “Our confidence
labour shortages in WA which the team has done a great in the turnaround and potential at Red Lake is growing, the
job managing but we remain conscious that it is an evolving Cowal underground mine is on budget and schedule and the
landscape which required constant management,” he said. cash generation and geological upside at Ernest Henry is
“At Simberi, our return to operations were interrupted by a outstanding.
COVID-19 outbreak on the island which temporarily raised “Aligned with our strategy, during this period of increasing costs
operating costs and lowered production.” and a challenging labour market, all planned expenditure will
After his appointment, Jetson said there was a saturation of be thoroughly assessed and gated with a focus on ensuring
gold miners in Australia and Canada and that he was actively we continue to prioritise margins over volume and earn an
seeking mergers and acquisitions as part of business plans. He appropriate return on capital. I am confident that Evolution is
has since sought to improve efficiency, lower costs and utilise one of the best positioned gold companies with its high-quality,
brownfields expansions at the Atlantic, Leonora and Simberi low-cost portfolio of assets.”
operations.
“In the mid-tier Australian gold miners there are certainly
too many of us. I believe strong consolidation is still needed,
particularly in that Tier-2 and Tier-3 type operation,” Jetson told
the Australian Financial Review in 2020.
Evolution indicated its June quarter production was likely to be
around 170,000oz, 15% higher than the March quarter, largely
driven by improved output from its Red Lake mine in Canada.
Klein pointed the finger at ongoing wet weather around Cowal
in New South Wales and COVID-related staff absenteeism
St Barbara’s plans for a sulphide expansion at its Simberi operations
at Mungari, where more than 30% of the workforce has been
in Papua New Guinea were put on hold in June, with the company
forced into isolation due to either illness or being deemed a
citing cost pressures
close contact since the WA borders opened on March 3.





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Page 11

NEWS www.ddh1.com.au




Online resource breaks new ground



by Michael Washbourne



aving chalked up more than 145,000 views since it was stop-shop service is going to be really helpful for those people who
Hlaunched two years ago during a time of great uncertainty, the are new to the country and new to the industry.”
Gold Industry Group’s (GIG) online Gold Jobs hub is primed to go Since its inception in early 2020, the Gold Jobs website has
further viral. advertised thousands of jobs, ranging from exploration and mining-
GIG chair Kelly Carter said the “one-stop-shop” for gold-related based roles to environment and community positions, from as
jobs and career information had taken on greater significance given many as 16 GIG member companies.
the growing labour shortages which have crippled most industrial Detailed job profiles also offer insight into a range of roles across
sectors across Australia over the past six months. engineering, drill and blast, geoscience, environmental science,
Australia’s gold sector currently employs more than 50,000 people operations, processing, support services, and health and safety.
but demand for skilled workers is tipped to rise substantially over Carter said online platforms such as Gold Jobs were vital for
the next three years as more mines come online and existing attracting new talent into the industry.
operations expand.
“Clearly the sector is very buoyant at the moment and I think
“It almost feels quite prescient now that we were able to develop opportunities that it offers in terms of the breadth of careers that
it and launch it when we did, which means that we’re really well are available, both technical and non-technical, will only continue to
positioned to be able to assist our members and the broader gold grow and grow,” she said.
community when the need will be at its greatest,” Carter told GMJ.
“There’s obviously a huge focus on ESG at the moment and that in
“When you think about the broader plays that are likely to occur in itself creates a lot of opportunity for a very broad range of skillsets
the next 12-18 months, if we see shifts in migration into Western to come into the sector. There are going to be enormous benefits
Australia and Australia more broadly, being able to have that one- for the sector from having people come in from other industries,




















Gold Industry Group board of directors. From left: Andrea Maxey (AngloGold Ashanti), Rebecca Ciotti (Northern Star), Kelly Carter (Gold Fields, chair),
Ian Bamborough (Saturn Metals, vice-chair), John Mullumby (Gold Road Resources), Rebecca Johnston (executive officer) and Justine Fisher
(St Barbara). Absent: Fiona Murfitt (Evolution Mining) and Cameron Alexander (The Perth Mint)

























Page 12

www.ddh1.com.au




Online resource breaks new ground bringing new knowledge and experiences.
“Personally, I think the gold sector is very attractive due
to the locations in which we operate. There are some
very established regional centres connected to the
gold sector, as well as FIFO options from Perth that are
very accessible with short flights. It offers great work/life
balance opportunities.”
Carter, who is Gold Fields Ltd’s vice-president legal and Bill Johnston, Rosie Villalba and Tara Rout
compliance, was recently elected chair of the GIG for
a second term. The appointment of Saturn Metals Ltd The Gold Industry Group recently hosted
managing director Ian Bamborough as vice-chair also
marked the first time an exploration company has been its sixth annual networking sundowner
where the winners of coveted Gold Class
represented on the member-based, not-for-profit industry
Awards were also announced.
association which is now in its seventh year.
A busy second half of the year looms for the group which
will culminate in the popular Diversity Debate. Evolution Mining Ltd community relations officer Tara Rout took
home the top honour of Gold Class Facilitator of the Year 2021 for
Speaking to GMJ prior to the release of the damning
delivering six Gold Class education sessions to both primary and
parliamentary inquiry into sexual harassment and assault
secondary school students.
of women in the mining sector, Carter heaped praise on
the gold industry for its proactive approach to stamping out Gold Fields Ltd was crowned Company of the Year for a second
inappropriate and illegal behaviour. year running, with nine Gold Class facilitators from the company
delivering 20 sessions.
“I think the gold sector has done very well – and certainly
Other award winners were Jessica Jones and Stuart Jenner from
GIG has done very well – in showing a very strong
commitment over a number of years to women in the Gold Road Resources Ltd, Novo Resources Corp’s Nicole Reweti,
The Perth Mint’s Rosie Villalba and Gold Fields pair Jay Stafford
industry, and we will certainly continue with that work and
continue to support industry in that work,” she said. and Daniel Borgas.
“If I look at how our organisation has evolved over the years
and the fact we now have a 50/50 split in our board on
gender basis, we obviously have a female chair, we have
a female executive officer, events like our Diversity Debate
is going into its fifth year this year, we are now in the fourth
year of our landmark sponsorship of women’s sport [as
the major sponsor of leading netball team West Coast
Fever], I think that really talks to a very strong commitment
from the sector that looks back a lot further than the last
12-18 months in terms of its commitment to women in the
industry and women’s participation in sport and society
more broadly, and I think that is work we can all continue
to build on.” Mike Spreadborough and Nicole Reweti
Jessica Jones

























Page 13

NEWS

AuTeco welcomes




growing pains




by Fraser Palamara



fter breaking bread with Ontario’s First Nations people and to dissecting regional targets and the remainder of drilling
Apresenting at Quebec’s premier mining conference in June, focused on resource expansion.
newly appointed AuTeco Minerals Ltd chief executive Darren “We’ve got 500sq km of ground in the area, so it’s not just
Cooke caught up with GMJ to talk all things North American gold the Pickle Creek deposit, we’ve got the northern part of the
before hitching his ride back to Australia. greenstone belt here,” Cooke said.
Cooke’s elevation from chief operating officer was just one of The regional drilling made significant headway in June after a
several management changes AuTeco made as it looks to 5.5m @ 18 g/t gold intersection confirmed previously untested
accelerate development of its 2.23 moz Pickle Crow gold project mineralisation at the Talia target.
in Ontario.
Other promising intersections from the drilling included 2.1m @
The shake up also welcomed vice president of environment and 92 g/t gold from 147.8m, 0.7m @ 26.2 g/t from 116.5m and 0.9m
community Tabatha LeBlanc and Juan Gutierrez, formerly of @ 14.7 g/t from 262.6m.
Northern Star Resources Ltd, as group chief geologist.
Cooke said proving up the fundamentals of Pickle Crow will be
As the drill rigs turn at Pickle Crow, Cooke beamed at the new important to perfect the economics of the project for development.
contributions set to be made by the fresh team.
“We’re still finding more gold,” he said. “I know people say it quite
frequently, but this is genuinely open in all directions. One of the
things I’ve learned over my career, it’s really important to know
the size of the prize you’re dealing with to get production right
from the start.
“I have seen companies that go in too early and build a mill that’s
too big or too small and it ends up wrecking the economics of the
project long term. We’re quite comfortable with expanding and
growing so we know what we’re dealing with.”
Cooke recently presented at the PDAC conference and said
despite the growing interest in battery minerals such as lithium
and nickel, many delegates still had a strong appetite for gold.
“People are starting to see the sentiment shift a little bit with a
big focus on batteries and the EV space over here in Canada,”
he said. “But there were a lot of gold explorers at the conference
and there was cautious optimism in the room.
“Theoretically, when you look at all the macro indicators in the
Canada is best explored during the winter when the ice supports drill
rig access economy; there’s inflation at levels we haven’t seen since the
1980s, a war in Ukraine and Bitcoin is getting smashed – these
are normally the key indicators to make gold go up. So, there’s a
“These changes were made to take the project further towards lot of cautious optimism for the markets to eventually turn.”
production and to get it ready for the next stage of evolution,”
Cooke also said Canada’s mining and resources industry was
he said. “Now that we have our project at a critical mass, we’re
starting to feel the brunt of labour shortages, but there were
starting to think about the best ways forward to monetise it.
some positives to exploring in the snowy north rather than down
“[LeBlanc] is really experienced in exploration and community under in Australia at the moment.
relations. She’s a local, knows the system well and has been
“It’s getting more and more difficult to get good labour in Canada,
involved in Ontario permitting from start to finish.
assay turnaround times are starting to blow out but are not as an
“[Gutierrez] is also one of my former colleagues, so we’ve got extreme issue as it is in Australia in my view,” he said.
some really high quality people to round out the team on the
“For us, personally, we’ve got a full complement of geologists and
ground now.”
we’re getting our assays in 15 days at the moment, so compared
AuTeco is currently in the midst of a 50,000m drilling to some of my compatriots back in Australia, we’re really lucky.”
programme at Pickle Crow which will see 20,000m contributed


Page 14

Aussie rise to put sector




under greater stress




by Dominic Piper



he pain may not be over for Australian gold producers moment has now passed, there is still opportunity to act
Twilting under labour and energy cost increases, with against currency fluctuations.
foreign exchange rates looming as the next element to “It is not as easy hedging the currency as it is gold or oil, but
erode margins. it can be done,” he said. “We hear from a number of people
Evolution Mining Ltd and Oz Minerals Ltd both announced they are bullish on gold, so are not hedging at the moment.
production downgrades and cost increases on June 27 as I know companies which used to hedge consistently but are
COVID, labour costs and energy prices bit hard on margins. not anymore because they think prices are going up and the
It has been a similar scenario elsewhere in the gold sector margins don’t justify it because costs are also going up.”
with St Barbara Ltd announcing downgrades at its Simberi There are historical warnings, however, according to Russo.
(Papua New Guinea) and Atlantic (Canada) operations “In 1985, the Aussie dollar fell, and in 1987 the gold price
earlier in June. had risen to $US500/oz and $A700/oz and everyone was
There appears to be little relief in sight with labour shortages saying ‘strap in’,” he said. “By Christmas 1988, the Aussie
set to continue and inflation affecting material inputs. The dollar was at 87c and at the same time gold came off 20%.
news could get worse, according to consultant Sean Russo The net result was every gold producer in Australia lost their
of Noah’s Rule, who believes margins could be further entire operating margin and nothing particularly dramatic
impacted by a rising Australian dollar. had even happened.
“The Australian dollar, given how strong commodity prices “A replay of 1988, that is the biggest risk. If the stock markets
have been, has been surprisingly weak and one of the return to favour, a lot of investors who bought into gold may
beneficiaries of that has been the mining sector,” Russo said. exit and go back to other assets classes. Gold had done
“That is the substantial risk in the medium term – even if its job in the last two years as the stock markets collapsed
commodity prices go up in US dollar terms, the Aussie dollar but now they may want to return to dividend yielding asset
could go up further.” classes.
If that happens, Russo anticipates international investors “It is going to be a one-two punch, first the oil prices then
departing from Australian gold company registers. exchange rates.”
“So, the challenge for Australian producers is that investors
have hung onto their shares because the margins looked
quite good due to the benefit of a weaker Aussie dollar,” he
said. “But as that turns, investors will think they are better to
move on US producers over Australian miners because the
Aussies have already seen their best days. That will have
ramifications for capital raising and the cost of capital.
“And, in a world where the pressure is on investors regarding
ESG, I think it will be easier to get money for critical minerals
than gold. Because of all that, I don’t think there will be many
raising capital for single asset stories any longer. It will be a
lot easier for larger companies to take over smaller ones.”
Russo’s advice is to begin considering ways of hedging
currency to cover any rebound in Australian dollar rates.
“We have always said that if you are a gold bull you must
be an Aussie dollar bull as well because most of the time if
gold is going up, the Aussie dollar is going up,” he said. “The
opposite happens occasionally but can only be considered
a purple patch.”
Noah’s Rule has been preaching oil hedging to its gold
producing clients for the last three years but while that
Sean Russo


Page 15

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COVER






Gold Fields looks for




Australia replica in the



Americas





by Dominic Piper






Players have been circling the gold M&A dancefloor for 18 months or more but while
rivals contemplate their approach, Gold Fields Ltd has made its move, sweeping
Yamana Gold Inc off its feet with a $US6.7 billion bid for the New York-listed miner.

























































Page 18 Page 18
Page 18

he deal will create the third largest gold miner in the “We weren’t not expecting a negative reaction,” he admits to
Tworld by output – group production will be 4 mozpa GMJ. “We understand when there is a premium paid there is
by 2024 – and hand Gold Fields a long-coveted Americas a market reaction, usually about 10-15% [depreciation]. We
portfolio, including operating and exploration assets across have seen 20% so, slightly more negative than we expected.
Canada, Chile, Brazil and Argentina. The market has got used to mergers-of-equals and you can
Gold Fields has always done things a little differently from its do that when your values are similar but when they are not,
Top 10 gold producer peers when it comes to growth. when one company is trading at a material discount to the
other, as was the case here, you can’t expect shareholders
Back in 2013, while the rest of the industry was rationalising
to be happy to sell at a discount.”
portfolios, turning to more domestic assets and slashing
exploration budgets, the Johannesburg-based miner chose Instead, Griffith is placing his faith in the Gold Fields business
an alternative course. development team which have spent more than six months
pouring over the Yamana asset base.
Having divested most of its South African asset base, it went
on an international acquisition spree, buying Barrick Gold “We absolutely understand why we are paying a premium,
Corp’s Granny Smith, Darlot and Lawlers mines in Western but we are clear that it is not the full value we see in the
Australia, expanding its Damang mine in Ghana and ramping company, there is a lot left in the tank,” he says.
up exploration and development studies on its Salares Norte “We spent a significant amount of time going through these
discovery in Chile. In 2016, it paid $250 million for a 50% assets, using a global team to do the due diligence. So, we
stake in Gold Road Resources Ltd’s Gruyere project, also in don’t expect shareholders to understand in one day what
WA. Exploration budgets were increased, most aggressively we’ve been working on for 6-7 months.
in WA where the $100 million annual budget has delivered “We have got an education process to do but we are willing
multimillion-ounce reserve increases in districts long to go through it. We have done one round of shareholder
considered mature. engagement, and we are incorporating the feedback into an
The result of the counter-cyclical strategy was a growing updated market presentation.”
production profile, just at the moment when peers were The competitive nature of the gold M&A space has been
struggling to reverse course amid an upturn in the gold price. created by an imbalance between ambitions and available
Nearly a decade on, the company has moved again. This options. Producers who have become accustomed to strong
time, however, the market circumstances are different. The margins are desperate for growth options but after a decade
entire gold sector now has growth ambitions but given the of underinvestment in exploration by majors and mid-tiers,
mass value destruction which occurred during the last wave options are limited. Discovery rates in the last 10 years have
of global gold M&A, most players have been reluctant to been strongest in the junior space but Griffith acknowledged
make the first move. Gold Fields could’ve looked there, as it did with the JV deal
Others’ reluctance would hardly have been extinguished by over Gruyere, but says the Yamana opportunity outweighed
market reaction to the Gold Fields-Yamana tie-up. Investors any other.
summarily abandoned the gold majors in 2012-13 after a fall “We didn’t exclude the idea of buying a single asset but
in spot prices exposed the recent round of corporate deals at the moment good assets are very expensive,” he says.
as extreme avarice, wasting cash and destroying value “When we looked at the value of Yamana, it came in at half
rather than increasing it. the price of the other assets. And, we would have to have
Since then, gold M&A has been circumspect and restricted paid cash for a single asset.”
to low-key asset acquisitions and nil-premium mergers, For Griffith – who replaced Nick Holland after his 10-year
the most high-profile being Barrick’s 2019 acquisition of stint as chief executive – the Yamana move is in keeping
Randgold Resources ($US6.5 billion) and Newmont Corp’s with the company’s recent approach to growth.
purchase of Goldcorp ($US10 billion). “One thing that Gold Fields has had over a number of years
So, the 33.8% premium Gold Fields is proposing was sure is a very clear and well executed strategy,” he says. “The
to attract criticism from various sources. And while new chief company is in good shape because of the focus of the team
executive Chris Griffith understands the scepticism, he says and board on that strategy.”
the company was steadfast in its appraisal of Yamana. As well as the instant impact on group production offered by



Page 19
Page 19 Page 19

COVER




“ One thing that Gold Fields




has had over a number

of years is a very clear and well
executed strategy

- Chris Griffith













































Yamana’s mines – more than 870,000 ozpa attributable from Glencore plc – 7.9 moz gold, 5.3mt copper reserves – in
Canadian Malartic, Cerro Moro, El Peñón, Jacobina and Argentina is currently in PFS.
Minera Florida – the acquisition provides Gold Fields with a “We are not buying greenfields assets, this puts us in good
crucial element currently missing in its outlook, development shape to develop assets,” Griffith said. “And, apart from the
options. discovery of Salares Norte, the reality is we haven’t had a
“I have had people say: ‘You’re in great shape, you don’t big exploration portfolio, Yamana also brings that.”
need to do anything’ but it is because we understand what The merger also adds further geographic diversification.
we need to do for the future, not just now,” Griffith says. “We Griffith has been keen to expand Gold Fields’ Americas
have got into a good position, but peak production is in 3-4 exposure beyond Salares Norte (Chile) and Cerro Corona
years’ time and it will be declining after that because of the (Peru). The Yamana portfolio will satisfy that desire,
mine life in Ghana and Peru. But the company strategy has potentially taking South America’s contribution to 40%,
always been around thinking about the next 10-20 years. raising it above the Australia region.
“We currently don’t have a pipeline for the future.” Griffith sees opportunity to replicate in South America what
The Yamana growth assets appear to be at an ideal point the group has achieved in Australia.
of the development pipeline. The 150,000 ozpa Wasamac “We would like to have similar regional substance,” he says.
project 100km west of Canadian Malarctic is in final “We are very happy with our presence in Australia and
permitting while the massive MARA JV with Newmont and want to grow that and grow South America. Having more


Page 20
Page 20

Griffith doesn’t rule out further moves but it appears they
would likely continue the New World theme.
“It feels like more M&A in gold is coming and we have the
balance sheet to be opportunistic as it comes up,” he says. “I
think our focus is on South America and Canada.”
That may sound like a reluctance to look closer to home, but
Griffith says Gold Fields would still consider options on its
home continent, if not inside domestic borders.
“South Africa is not the place we’re currently looking to
invest, other than our existing operation. It has nothing to
do with jurisdictional risk, it is because it is very mature
geologically so there is not the same opportunities,” he says.
“In Ghana, we still have opportunity at Tarkwa and at Damang
where the open pit is coming to the end of life but we have
a PFS on the underground. We also have the investment in
the Asanko gold mine. That has high potential, it just needs
the exploration work to be done.”
The Tarkwa mine, Ghana
South Africa may be sidelined as a growth option, but the
company is on a surer operational footing there than at any
time in the last 10 years. The company’s iconic South Deep
mine has always flattered to deceive but finally seems on
a satisfactory growth trajectory with production increasing
29% to 290,000oz gold in 2021.
“South Deep is performing well, and with a 20-30% increase
forecast over the next four years, it will be up there with all
the flagship operations in the group,” Griffith says. “Likewise
delivery of Salares Norte. First gold will come next year and
production will peak for the first two years at 600,000 ozpa
before settling at 450,000 ozpa.”
It is apparent all Gold Fields’ growth ambitions – from
the patience shown with South Deep to Salares Norte’s
prolonged development and the Yamana acquisition –
have been made possible by the strength of the company’s
Australian division.
The WA portfolio contributes 935,000 ozpa to group output
and 60% of free cash flow, and is likely to retain that level for
than 1 mozpa and four mines provides the benefits of scale,
some time yet.
overhead spread, etc. It has always been our intention to
An aggressive exploration approach has been key to
bulk up South America.”
maintaining those levels.
In addition, the acquisition will give Gold Fields its first entry
“We continue with high levels of exploration, with $100
into Canada via a 50% share in Canadian Malartic, a plus-
300,000 ozpa producer with a massive exploration holding million a year spend for six years,” Gold Fields Australasia
vice president Stuart Mathews tells GMJ. “That dropped
around it.
to $80 million this year because we divested Darlot and
“We have been trying to get into Canada and up to now it has
Gruyere now has a good mine life but we still managed to
proven very expensive,” Griffith says. “This gives us access
add three years of reserves anyway.”
to Canada in a relatively cheap way with exploration potential,
That replacement is all the more remarkable give the maturity
which is more than a single asset would deliver.”
of the asset group. St Ives, Agnew and Granny Smith were
With the company already stretched across several regions,
all believed to have their best years behind them when Gold
is it a risk moving to new jurisdictions?
Fields took up ownership but those assumptions have been
“You could have asked the same questions [about jurisdictional summarily upended thanks to that spending and the group’s
diversification] when we went into Australia, the rest of Africa, operational performance.
Peru or Chile,” Griffith says. “We are globalised and will stay
“We have done well on production, eight years of delivering
in a number of jurisdictions, it’s an ‘and’, not an ‘or’.”
Page 21

COVER

Gold Fields Australasia vice president Stuart Mathews at the Agnew mine




















































on plans, some of the rhetoric about mine life has gone away. “We have been looking right across exploration at St Ives,
Grown it 11 times since acquisition. The reward for that and there are still opportunities for small-to-medium open
investment is massive – around 11 moz gold discovered.” pits. However, the real future is in the vertical extent, we
At Agnew, $24 million is being spent on exploration this year have to go underground with the drilling. We could probably
with Mathews confident the reserve growth – reserves have spend $50 million a year if I had it. The nature of the orebody
risen from 520,000oz four years ago to more than 1.1 moz means we are investing all the time but at $US1,217/oz it is
today – will continue. the lowest cost producer in the group [except for the younger
Gruyere].”
“It is a very positive story,” he says. “We are generating good
cash at 200,000 ozpa and we are delivering more ounces, The renewed sense of energy is coursing through the entire
not just replacement but new reserves and extensions,” group, reflected by its major investment in renewables
Mathews says. “We are also finding new ore shoots, and projects across all four operations. Agnew now operates with
targets like Redeemer and New Holland are delivering a 56MW renewable microgrid comprising five wind turbines,
fantastic results 2km away from where we were two years a solar farm, battery system and off-grid gas/diesel engine
ago.” power plant.
St Ives has been the real standout, with the Invincible At Granny Smith, a new hybrid power system, which has
discovery made in 2017 now close to 4 moz in resources. been integrated with an existing gas fired power station, is
powered by more than 20,000 solar panels and supported
“Invincible remains the focus at St Ives because we still don’t
by a 2MW-1 MWh battery system. Once fully operational, it
know how big it is,” Mathews says.
will reduce the mine’s fuel consumption by 10-13%.
Invincible reinvigorated the exploration approach at St Ives
Mathews said the renewables project had offered purpose
and while another massive discovery is unlikely, the geology
where it had previously been lacking.
team is confident of further finds, particularly at depth.
“The renewables project and the new camp at Agnew have



Page 22

changed morale at that mine,” he says. “Everyone wants
to work there because people love doing the right thing
and being involved in a project which is contributing to
decarbonisation.
“We took that leap of faith because we knew we had to put
some capex in at the time, so it made sense putting further
capex in elsewhere. Now we have done it successfully, it
gives us confidence to do it elsewhere. We have installed
renewables projects at Granny Smith and Gruyere and we
are conducting a feasibility on a project at St Ives which
would dwarf what we have done at Agnew.”
Sustainability can be an overused word in modern gold
mining, but Mathews believes Gold Fields’ renewables
strategy is the very definition on several fronts.
“These projects not only deliver clean energy, which gives
us good visibility in the market, but once we eventually
own it outright, our power costs will drop 80%,” he says.
“Ultimately, it helps us be more sustainable from not only an
ESG but also a cash cost perspective.”
A mature operation where costs are going down almost
defies logic but given Gold Fields’ counter-cyclical approach
of the last decade, it is hardly surprising the company has
pulled it off.
And, if its latest gambit with Yamana works, the slick moves
in Australia could be supplemented by a few Latin American
dance steps.


















































Page 23

YOUR SUSTAINABLE REFINING PARTNER
DIGGERS & DEALERS PREVIEW




Miners find support in




Goldfields’ historic towns





















When the mining world arrives in the Eastern
Goldfields for the Diggers & Dealers forum in
August it will find two local governments much more
attuned to the challenges facing the industry.



















Drilling on Lake Lefroy, Kambalda. The historic towns of the
Eastern Goldfields have a symbiotic relationship with the
mining industry

ustralia’s biggest resources industry conference in towns like Kalgoorlie-Boulder, Coolgardie and Kambalda.
Aprovides an annual sugar hit to the local economy but “No doubt, the lack of housing, land and bodies is inhibiting
City of Kalgoorlie-Boulder Mayor John Bowler and Shire of expansion and growth of the industry,” Bowler admitted. “I
Coolgardie chief executive James Trail are determined to urge the industry to put pressure on local councils and the
ensure the sector’s overall impact is sustained throughout State Government, tell us as it is and be honest with us.
the year. To achieve that, both have recognised the need to
“The biggest thing is the Federal Government taking the
be more collaborative with industry.
foot of the hose on skilled migration and to find a way of
“I think as a council we have failed the industry for not being marrying up the generational underemployment we see in
pro-development enough,” Bowler told GMJ. “But there is the East with the thousands of unfilled jobs we have here in
a change in mood and a recognition of just how dire the the West. We have seen labour shortages from time to time
accommodation and light industrial land availability is in the but never anything of this volume and duration.”
region.”
There has always been a debate about miners’ contribution
Bowler’s comments highlight the constricted nature of to the local economy and fabric of the community and Trail
the West Australian mining sector at present. Labour is believes his council has finally settled on a process to move
expensive and difficult to come by but even when miners forward.
do find workers, they are struggling to accommodate them



Page 24

YOUR SUSTAINABLE REFINING PARTNER







“It is always a balance and we always want more but there a few teachers, another police officer and so forth,” he said.
has been a big change in the last few years of us working “The problem is sometimes middle management of these
with industry in a more collaborative way,” Trail told GMJ. larger companies think they have to cut costs and choose
“Five years ago, we would always think ‘they should write a non-local suppliers. But when you’re on site and that part
cheque’ but we have come to realise it is more sustainable breaks, you might be waiting 4-5 days but if you’d bought
to work through their operating budgets. If we can find the local, they could be out within hours.”
value proposition to discuss how we can help them – whether
Local companies, he said, were also generous contributors
by using the airstrip, our waste management services, or
to the social fabric of communities.
accommodation services,
“You look at a company like Kalgoorlie Case and Drill and
then you’ll find a greater
their contributions in town, whether to charities, sporting
contribution from them.
clubs, social groups, and other good causes, it has been
“As a result, our working
amazing. They live here and walk the talk while others
relationship has improved
who aren’t based here don’t even donate to the footy
significantly and there is
club.”
a direct line between me
Kalgoorlie-Boulder and Coolgardie are enjoying the rare
and the CEOs.”
experience of strong prices for both nickel and gold but
Trail said encouraging
both Bowler and Trail are aware a downturn will inevitably
miners and explorers to
arrive. However, each are confident the region can
use the Shire’s services
continue to prosper.
would free up funding for
“We’ve taken a view to take advantage of the next 5-7
other programmes.
years in front of us, to make sure we are much better
“Inflation is currently
prepared in regards to land availability, accommodation,
around 5-6% but we
etc, and be in a position to
can’t put rates up 6-7%
John Bowler allow companies to take
to continue with our
advantage for the next seven
services. But, if the mining
years, instead of planning
companies are contributing by using our services –
now and only delivering as
whether that is waste management in Coolgardie or
the boom comes to an end,”
the new accommodation village in Kambalda – we
Trail said. “That way, when it
can maintain programmes like the medical service,
is the downturn, the Shire is
meals-on-wheels or the recreation centres, pools and
still in a strong position to ride
libraries in the towns.
out the tough times.”
“Shire revenues are expected to climb from $13
Bowler sees encouragement
million last year to $26 million this year and $33
in the rise of other
million next year thanks to the contribution of miners
commodities in the Eastern
and contractors.”
Goldfields.
As well as striking a closer relationship with miners,
“We are in quite amazing
the Shire of Coolgardie has also created an ESG
times with gold at nearly
framework which will assist miners’ sustainability
James Trail $2,600/oz and nickel at
reporting according to Trail.
$24,000/t, they are wonderful
“Our new social economic assessment tool allows for prices but Kalgoorlie is always
effective and reportable investment in ESG by the miners,” after a broader base,” he said. “We have rare earths coming
he said. “For instance, we have built into the tool the up with a $500 million plant coming here soon and there
contribution of Gold Fields [Ltd]; how many people they are will be flow on from that. Then we have lithium as well, so
employing, what they are procuring locally, etc. Now that is if one commodity is down, there are 3-4 others which can
measured, we can say what Gold Fields is contributing and be on the up.”
they can report it within their own ESG frameworks.”
For Bowler, continuing to encourage local procurement and
employment is crucial to the future of his city.
Australia’s Premier
“Mining jobs are a great multiplier,” he said. “If you have
100 more mining jobs in the town, that equals a further 20 Mining Forum
service jobs – fitters, welders, electricians – then probably
1 – 3 August, 2022
Page 25

YOUR SUSTAINABLE REFINING PARTNER
DIGGERS & DEALERS PREVIEW



Road clear for



next phase of



growth



Following the disappointing performance of the processing plant
by Michael Washbourne in 2021, the Gruyere JV appears to have turned the corner with
71,135oz produced in the March quarter

old Road Resources Ltd managing director Duncan Gibbs Gibbs conceded the combined Gold Road-DGO exploration
Gsays the company is looking forward to having “a seat at the portfolio was “too big” for the company to advance on its own
table” in future discussions concerning the 8.5 moz Hemi deposit and potential divestments and/or JVs will be considered in due
after completing its acquisition of De Grey Mining Ltd’s major course.
shareholder. Gold Road has progressively dropped tenements along
As this edition went to print, Gold Road had moved into compulsory the Yamarna greenstone belt over the past few years – the
acquisition of DGO Gold Ltd following a recommended all-scrip company’s ground position has reduced from over 5,000sq km to
takeover of the Ed Eshuys-chaired exploration and investment about 3,500sq km – with consistent production from the Gruyere
vehicle. It was the company’s first successful transaction since JV now the priority.
striking up a JV with Gold Fields Ltd to develop and operate the Despite a challenging 2021 which saw the Gruyere JV fall short
Gruyere mine in late 2016. of both the initial (260,000-300,000oz) and revised (250,000-
Gold Road was last year outbid for both IGO Ltd’s 30% stake in the 260,000oz) production guidance due to major and unforeseen
Tropicana gold mine and gold explorer Apollo Consolidated, by operating issues inside the processing plant, Gold Road still
Regis Resources Ltd and Ramelius Resources Ltd, respectively. issued shareholders with a fully-franked 1c dividend.
While DGO boasts an expansive exploration portfolio across Gibbs said NPAT of just $36.8 million, down 54% on the company’s
areas such as Mallina, Yerrida and Pernatty, the main prize for first full year of operations in 2020, was a disappointing result but
Gold Road was the company’s 14.4% relevant interest in market he remains confident the Gruyere JV can achieve guidance of
darling De Grey. 300,000-340,000oz in 2022.
DGO also holds major stakes in embattled miner Dacian Gold Ltd Sustained production of 350,000oz is targeted from 2023, based
(6.8%) and little-known explorer Yandal Resources Ltd (20.1%). on an increased 10 mtpa throughput.
“If you look at the offer we made, we’re effectively buying “The key theme to last year was really around the performance of
the company for the see-through market price of their equity the ball mill and the prevailing underlying issues related to bearing
investments,” Gibbs told GMJ. failures,” Gibbs said.
“The major value of DGO is quite clearly their 14.4% interest in De “Through the course of last year, we had a failure of a mill motor
Grey which is 90% or thereabouts of the value of DGO. It’s such a bearing, pinion drives and the trunnion, all on the ball mill. I think
strategic position in De Grey and realistically it gives us a seat at the lesson learned out of that is we bought that mill as a new
the table in any future development options for that asset [Hemi].” and unused piece of equipment which then travelled around the


























Page 26

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planet and spent a long time in storage before it was eventually modest, it’s probably in the hundreds of thousands of ounces,
brought to Gruyere. but it’s important for us to get that work done from a timing point
“Under normal circumstances, those bearings should really last of view so that we can bring those satellite pits into the mine plan
the life of the equipment. We’ve certainly had damage issues, and augment the ore supply from Gruyere,” Gibbs said.
either corrosion or transport related, and they operate fine for a “We know the orebody is open at depth and while we think there’s
bit but then they start to degrade. Most of the time we picked it up potential for further cutbacks on the pits, they will come at higher
through normal monitoring and things like that, but obviously we cost. So, alternatively, and essentially a bigger opportunity, is to
had to replace those bearings which wasn’t something that we look at taking things underground in the longer term.
factored into budgets, plans and guidance, so that resulted in a lot “We’re certainly seeing big, wide albeit low-grade zones of
of extra, unscheduled mill downtime through last year, particularly mineralisation at depth. It’s really about finding the right technical
during the June and September quarters. mining solution for what will be a very large-scale underground
“Where we’re sitting now, we haven’t had any significant issues operation. So, quite unlike your typical West Aussie gold mine,
with the ball mill for more than six months, so we’re pretty we’re talking essentially stope areas with some bulk mining
confident that we’ve addressed the major bearing issues. Once methods.”
you’ve replaced them with good bearings, they should stay fixed.” Gibbs said the company’s exploration commitment is likely to
Offsetting the underperformance of the processing plant was remain around the $30 million mark once again, pending the
the outperformance of the Gruyere orebody. Reserves were outcome of RC and diamond drilling completed on a number of
increased by almost 1 moz last year to 4.45 moz despite mining greenfields targets as far back as February.
depletion and higher grades of circa 1.3 g/t gold are now being Gold Road is now one of the few Australian resource companies
extracted from the main pits. to be part of the Dow Jones Sustainability Index, a feat which
“I guess the big advantage we’ve got with Gruyere is it’s pretty Gibbs believes reflects the maturing evolution of the company’s
“It’s probably a key differentiating factor “ While we’ve had some who are urging the company to bolster its
share register, especially those investors
simple,” Gibbs said. “You’ve got these big
wide ore zones that really make it quite
operating portfolio through M&A.
hard to muck up the estimation of grade
and have big problems with dilution and
However, Gibbs has some encouraging
what have you. It’s very much done what
words for those investors who still
plant hiccups, our key
we expected it to do.
gold explorers in the business.
to a number of other Aussie gold start- fundamental asset being the consider Gold Road to be one of the best
“Exploration is high risk but if you get it
orebody has been excellent.
ups in recent years where the Achilles right, it’s the biggest uplift in value you can
heel has been an orebody problem and really create in the gold sector,” he said.
broadly less gold than they thought. So, while we’ve had some
“We’re obviously open and have been quite active looking at the
plant hiccups, our key fundamental asset being the orebody has
M&A space. It’s no secret we were underbidders on Tropicana
been excellent.”
and Apollo, but both of those ultimately transacted for prices
Further reserve growth is expected to come from ongoing which were beyond where we thought we were creating value for
exploration across the Golden Highway series of orebodies about shareholders.
25km east of the Gruyere mine, while it appears increasingly likely
“You’ve got to have some discipline, which I think we’ve
operations will eventually move underground with the resource
demonstrated, to be able to walk away from deals.”
extended to 850m below surface.
“We think the opportunity there for reserve growth is reasonably

























Page 27

A wide-ranging career across the

commodity trading sector has given

Nicholas Frappell rare insight into the
world’s gold market, and Australia’s gold

mining sector could benefit from it.













my mind, that is the cornerstone reason why we are seen as
stable and trustworthy.”
For many miners, refining is an almost after-thought following
all the hard work of extracting gold from the ground.
However, in a world of increasing scrutiny of the entire
precious metals sector, producers need a refining partner who
Nick has worked in the gold sector for can be relied on to deliver consistent, sustainable outcomes
nearly three decades across markets in line with their own community and investor expectations.
as varied as London, Hong Kong and “I like to think that part of the change that ABC Refinery has
Tokyo, trading spot, swaps and futures brought to the marketplace is a focus on the importance
of refiners to a miner’s offering to its shareholders and the
for banks and quoting prices to hedge public at large,” he says. “So, while the refining part of the gold
funds, gold producers and automobile mining process may have historically been seen as a purely
service-related offering at end of the value chain, ABC Refinery
companies across the world. and the broader Pallion group have shown how refiners
can work with their mining clients for mutual economic,
The last six years have seen him apply that insight to his role environmental and social benefit.”
as Global Head Institutional Markets at ABC Refinery. There Part of that work is Nick’s extensive knowledge of global
he is tasked with growing the Refinery’s international reach gold markets. He believes providing clients with reliable
through traditional business development but also providing information and analysis of market trends is a crucial part of
commentary on the gold market for both buyers and ABC Refinery’s offering.
customers from the gold mining sector.
“A large part of my role is international business development
ABC Refinery – part of the broader Pallion group – is LBMA, and growing bank structured finance for the business but in
SGE, COMEX, RJC, NATA, ISO, ILAC, IEC and Standards Australia more recent times I’ve found myself providing commentary
accredited but Frappell sees those as only a base line to a on gold markets for clients, particularly the gold miners,” he
broader commitment towards technical excellence and says.
responsible sourcing.
“Part of that theme of trust is putting information out that
“To be a truly trusted partner for gold miners as well as is credible and trusted. You don’t have to have a crystal ball
investors, traders and consumers, it’s more than just about but try to communicate in a way people can rely on it. When
being accredited,” Nick says. “The commitment to technical you’ve been active in this market for three decades across
excellence and responsibility has to come from within and to various roles, you get to see all sorts of things and begin




Page 28

to recognise patterns and relations between the various developments in the electronic tracing of metal inputs in-line
elements driving the gold price. with an emphasis from consumers on responsible sourcing
and supply chain integrity.
“This has been particularly useful for our mining clients who
naturally want to know what is happening in the space but “ABC Refinery has partnered with software company
haven’t always got the time to analyse it themselves. Through Blockhead Technologies to create a technology platform that
hosting ‘The Pod of Gold’ podcast, I can communicate what enables precious metal traceability and tampering detection
I am observing in a way which is more digestible, providing called PROVCHECK™ Security Bar Technology that utilises the
context in relation to other asset markets.” unique ‘fingerprint’ of precious metal products to record the
environmental supply chain credentials of specific items of
Nick’s insights are part of a wider approach within ABC bullion produced by ABC Refinery which can be verified by
Refinery to provide extensive support to partners.
consumers utilising a free to download iOS or Android mobile
“ABC Refinery is not just a service provider, our enviable application.”
rate of growth is driven by the fact that we partner with our
clients for long term mutual benefit,” Nick says. “Indeed, our
strategy is to carefully select partners who share our vision of
efficiency, sustainability and supply chain integrity. Not being
constrained by legacy systems, we champion the Australian
gold sector globally by investing in the best people and
utilising the latest environmentally sustainable technologies.
And our strategic location in Australia’s largest trading hub
provides significant logistical advantages to our partners in
both domestic and international markets.”
The approach extends into support across ESG and other
components of the gold mining process.
“ESG is something that is part of the corporate ethos of ABC
Refinery and its parent company Pallion. Pallion publishes its
Considerate® Precious Metals Sustainability Report annually
detailing Pallion’s various initiatives in implementing the
Pallion Sustainability and Responsibility Charter in all its
locations globally.
“Complementing that responsible sourcing and
environmental commitment are ABC Refinery’s



Page 29

DIGGERS & DEALERS PREVIEW




Hemi upgrade sets up PFS





by Dominic Piper


e Grey Mining Ltd has taken its Hemi discovery several treat the gold-bearing sulphide ores.
Dsteps closer to development after a revealing a massive The company said the combination of HPGR and POx was
resource increase and defining a preferred processing route for proven to deliver lower capital and operating costs, higher gold
the project. recovery (93-95%), 20% lower energy consumption, 25% lower
De Grey has barely missed a beat with Hemi since its discovery reagent consumption and 25% lower CO₂ emissions than other
in early 2020. At a combined 10.63 moz @ 1.3 g/t gold, the processing options assessed.
company’s wider Mallina project is undisputedly Australia’s “HPGR and POx are robust, well proven and accepted
largest undeveloped gold project. technologies that have been chosen after extensive testwork,”
The recent resource upgrade lifted Hemi’s contribution to that Jardine said.
10.63 moz total to 8.6 moz, up from 5.8 moz in the maiden The flowsheet selection marks a major milestone for De Grey
resource. which had faced some scepticism about potential recoveries
Technical director Andy Beckwith said the estimate included a from Hemi’s sulphide ore. In April, Jardine told GMJ the company
strong indicated component – some 80% of overall resources – was confident processing would prove a problem for Hemi.
paving the way for a PFS in the coming months.
“Hemi continues to grow… RC and diamond drilling over the last
12 months has delivered on three key aspects; extending open
pit mining potential, infill drilling to convert inferred to indicated
resource to 370m and geotechnical and metallurgical drilling to
enable the PFS economic study to advance,” Beckwith said.
The company has now defined six separate orebodies at
Hemi with the two most recent discoveries, Diucon and Eagle,
delivering the bulk of new ounces in the resource upgrade.
Diucon now sits at 1.635 moz @ 1.3 g/t and Eagle at 948,000oz
@ 1.1 g/t. Beckwith said both remained open at depth and to
the west.
An updated resource of 10.63 moz for the Mallina project is likely to
The infill drilling completed, De Grey now has its eye on other be superseded in 2023 as De Grey continues drilling at the massive
targets. discovery
“The Hemi footprint is approximately 3.5km east-west and 2km
north-south,” De Grey managing director Glenn Jardine said.
“The mineralogy is consistent across the deposits, so it is more
“There is significant resource extension and discovery potential
about proving greater confidence in ourselves and showing the
in areas adjacent to the existing footprint and at depth.”
market that we have done all the technical work required for this
“The exploration focus over the next 12 months and beyond size of project,” he said at the time.
will now pivot back to resource growth through along strike and
“We are getting consistent recoveries in the mid-90% range.
down dip extensions at Hemi and the high priority untested
In the PFS it is more about doing the trade-off studies on the
targets within the Greater Hemi region and large regional
communition and oxidation processes we use. That is important
tenement package,” Beckwith added.
for investors, and we are hopeful of advancing which oxidation
The latest resource will be plugged into the PFS, due for process we will use ahead of the PFS, providing the market
release this quarter. The company said it expected to increase more certainty.”
production and mine life from its October 2021 scoping study
The combination of metallurgical success and increased
which was based on 4.3 moz gold produced over 10 years.
ounces will allow De Grey to plough on with a PFS which should
“The increase in indicated resources and completion of the PFS mark Mallina as the most exciting development story in the
are expected to provide a strong basis for project development global gold sector.
and financing,” Jardine said.
“The significant increase in the scale and confidence level of
The project also received a major boost with a process mineral resources along with the robust flowsheet selected for
flowsheet study by Wood Australia identifying a three-stage processing at Hemi enhance and de-risk the project,” Jardine
10 mtpa crushing circuit using high-pressure grinding rollers said.
(HPGR) and a pressure oxidation (POx) plant could be used to


Page 30

“Optimisation of an existing process plant
can deliver both immediate results and also
long-term benefits for our clients. We have

found that a collaborative process is
extremely effective in increasing throughput
– often without changing major equipment”
John Sobolewski – Mintrex, Chief Executive
Officer.



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the



Bottlenecks











Mintrex are frequently invited to collaborate with clients to optimise and

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benefits that we have seen in the past:


Increased throughput
Increased recovery

Reduced shutdown time
Reduced replacement time and wear on components
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Bottlenecks, please refer to Page 30-34 on the Ebook) with the brownfields experts at Mintrex
please contact us on 08 9442 3333

DIGGERS & DEALERS PREVIEW







Boda resource


‘just the beginning’













by Fraser Palamara The drilling continues for Alkane at
Boda and its sister deposits in NSW


fter more than 71,000m of drilling since the discovery hole stage mining and ore processing plan for Boda. The first stage
Ain mid-2019, Alkane Resources Ltd has released a long- would produce a copper-gold concentrate for immediate sale
awaited maiden resource of 624mt @ 0.51 g/t gold equivalent while the second stage would produce gold bullion from a cyanide
for 10.1 moz for its Boda gold-copper porphyry deposit in New leach process. Preliminary recoveries have so far achieved 85%
South Wales. purity for gold, copper and silver.
The estimation presented two different development options for Porphyry systems like Boda are often seen as geologically
Boda, with the aforementioned 0.3 g/t cut-off supporting a large complex which has prompted Alkane to focus on how it
scale open pit operation, while the higher 0.4 g/t cut-off (353mt @ communicates the potential of the deposit with its shareholders
6.3 g/t for 7.1moz) amenable to bulk tonnage underground mining. more than another deposit would warrant.
Alkane managing director Nic Earner was elated when speaking Earner said he was satisfied with how Alkane has communicated
to GMJ following the years of work on Boda. Boda’s strengths in the wake of releasing the maiden resource.
“We’re really happy,” Earner said. “You don’t often make these “[Alkane’s share price] hasn’t really changed since the
sort of discoveries…but also to be able to turn it into a resource announcement because I think we met peoples’ expectations,”
that you know is economic and substantial, we’re really happy he said. “Amongst retail shareholders, and we have a really
with that…broadly, I think most people are saying, ‘good work, strong retail base, some people are excited by the resource.
keep it up’.” Other people are still confused, a little because it’s a porphyry
Despite being a massive milestone for the deposit, which is part of deposit and they’re used to reading orogenic gold vein deposits.
the Northern Molong project outside of Dubbo, Earner maintains “That’s part of why we put out such a strong communications
this is “just the beginning” of what’s to come. programme to explain that.”
“This initial resource begins to show the significant potential of Earner’s confidence in Boda is supported by other successful
both Boda and the larger project,” Earner said. porphyry projects such as Newcrest Mining Ltd’s Cadia gold
“Alkane is planning further drilling across our tenement package mine.
and is continuing the preliminary work that is required to further “These sort of deposits, people are mining these profitably all
understand the mining and processing options for the future.” over the world,” Earner said. “We’re greatly encouraged by that,
Near-term drilling will also continue to target extensions south we look at that, and that’s absolutely part of our thinking.”
of Boda, including the aptly named Boda Two deposit, and Alkane also recently celebrated processing 500,000oz gold from
northwest of Boda towards the Kaiser target which is already its Tomingley mine in May. Mining at Tomingley started in 2013
undergoing infill drilling. Alkane is expecting to pin down a maiden and the original plan outlined 380,000oz production from an open
inferred resource for Kaiser in Q4. cut and underground operation across seven years.
“We’re deep into the RC programme for Kaiser,” Earner said. “[This has proved] that our confidence was well founded,” Earner
“We’re going down to about 250m to do a shallow open-pit-able said. “We have met or exceeded our production guidance every
resource for that. That’ll come through over the next couple of year of operation and surpassed our original targets.”
months, although laboratories and consultants are still a bit Alkane intends to produce a further 700,000z of gold over the
congested from COVID-19 affecting the workforce.” next 10 years from Tomingley, 50km southwest of Dubbo.
Alkane believes the deposit remains open at depth and along The mine currently receives gold from the Caloma and Wyoming
strike to the south and northwest. deposits while Alkane is working on development approvals for
A preliminary metallurgical study has outlined a potential two- San Antonio and Roswell.


Page 32

Page 33

vmdrilling.com.au



2022 EXHIBITOR LISTING & FLOOR PLAN BY BOOTH NUMBER

1 Rapid Crushing & Screening 61 Lithium Australia NL 122 ADD Business Group E1 Lunnon Metals
Contractors Pty Ltd 62 Astral Resources NL Pty Ltd E2 Saturn Metals Limited
2 Cazaly Resources Limited 63 Hexagon Mining 123 Canaccord Genuity E3 Australian Vanadium Ltd
3 NRW Holdings 64 Firefinch Ltd 124 Canaccord Genuity E4 Hammer Metals Ltd
4 Sandfire Resources 65 Middle Island Resources Ltd 125 Westgold Resources Limited E5 Galan Lithium Limited
5 Kin Mining NL 66 Hot Chili Limited 126 MLG Oz E6 OzAurum Resources Limited
6 Como Engineers Pty Ltd 67 Boab Metals Limited 127 Matsa Resources Limited E7 Kingwest Resources Limited
7 Deloitte 68 PYBAR Mining Services 128 Core Lithium Ltd
8 Australia’s Paydirt 69 Liontown Resources 129 Hastings Technology Metals E8 Black Cat Syndicate Limited
9 Kalamazoo Resources Limited 70 Gold Road Resources Limited E9 NickelSearch Limited
10 New Century Resources 71 Sandvik Mining and 130 Peel Mining Limited E10 Moho Resources Ltd
Limited Rock Solutions 131 DEVELOP E11 Trigg Mining
11 Ausgold Limited 72 Gold Fields Limited 132 Gekko Systems E12 Blackstone Minerals Limited
12 Magnetic Resources NL 73 Predictive Discovery Limited 133 SolGold plc E13 Rox Resources Limited
13 Wiluna Mining 74 Pantoro Limited 134 Gateway Mining Limited E14 Great Boulder Resources
14 BGC Cement & Lime 75 Clarke Energy 135 Victorian Government Limited
15 Horizon Minerals 76 Newcrest Mining Limited 136 Deterra Royalties Limited E15 Anova Metals Ltd
16 Topdrill 77 MineARC Systems 137 Global Lithium Resources E16 Eagle Mountain Mining
17 Evident Australia 78 The Perth Mint Limited Limited
18 Medallion Metals Limited 79 Lefroy Exploration Limited 138 Venture Minerals Limited E17 Carnaby Resources
19 Geological Survey of 80 Konkera Corporate 139 ALS E18 Azure Minerals Limited
Western Australia 81 Aeris Resources Limited 140 BASF E19 Galena Mining Limited
20 Jervois Global 82 Macmahon Contractors
21 De Grey Mining Ltd Pty Ltd
22 HiSeis Pty Ltd 83 Regis Resources Ltd
23 West African Resources Ltd 84 Haines Surveys
24 Panoramic Resources Ltd 85 Evolution Mining
25 Energy Power Systems 86 Teck Australia Pty Ltd
Australia (EPSA) 87 Centaurus Metals Limited
26 OZ Minerals 88 Neometals Ltd
27 ASX 89 Wood Australia Pty Ltd
28 Stavely Minerals Limited 90 Lynas Rare Earths Ltd
29 VM Drilling 91 Rowe Scientific Pty Ltd
30 Fenix Resources 92 Genesis Minerals Limited
31 METS Engineering 93 Encounter Resources
32 S2 Resources Ltd Limited
33 Ardea Resources Limited 94 BHP Nickel West
34 Downhole Surveys 95 Carey Group Holdings
35 Antipa Minerals 96 Geoscience Australia
36 Alicanto Minerals Limited 97 Adriatic Metals Plc
37 Red 5 Limited 98 Kal Tire Mining Tire Group
38 Bureau Veritas Minerals 99 Greatland Gold plc
39 Austin Engineering 100 Aggreko
40 Breaker Resources NL 101 AngloGold Ashanti Ltd
41 MiningNews.net 102 Tietto Minerals Limited
42 Jindalee Resources Limited 103 Pilbara Minerals
43 SRK Consulting 104 WesTrac Pty Ltd
44 Mincor Resources NL 105 Perenti
45 Micromine 106 Curtin WA School of Mines
46 Alto Metals Limited 107 Poseidon Nickel Limited
47 Chesser Resources 108 St George Mining Limited
48 Government of South 109 S&P Global Market
Australia Intelligence
49 Rumble Resources Ltd 110 Ramelius Resources Limited
50 SGS Australia Pty Ltd 111 Auteco Minerals Limited
51 Chalice Mining 112 Bellevue Gold
52 Agnico Eagle 113 Emerald Resources NL
53 Swick Mining Services 114 Australian Underground
54 Musgrave Minerals Ltd Drilling
55 K92 Mining Inc. 115 Calidus Resources Limited
56 Intertek Minerals 116 Far East Capital
57 Legend Mining Limited 117 Cockburn Cement Limited
58 Bis 118 Mining People International
59 Red Dirt Metals 119 IGO Limited
60 Hays Specialist 120 Element 25 Limited
Recruitment Pty Ltd 121 Karora Resources Pty Ltd

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DIGGERS & DEALERS PREVIEW



Westgold takes road




less travelled




by Dominic Piper


estgold Resources Ltd has bucked the trend of guidance more than 4 mtpa of ore across the group from FY23.
W backtracks, now the company is just waiting for investors to With Bluebird already in steady-state phase, Westgold is now
realise it. enjoying a consistency which has previously proved elusive.
While the rest of the West Australian gold industry was revising “If we can deliver this quarter, that will be four consecutive quarters
targets amid labour shortages and cost pressures, Westgold is on on guidance and cost, I’m not sure we’ve ever done that before,”
target to post a fourth consecutive quarter on guidance, thanks to Bramwell said. “With that, we can evidence the fact we are starting
record performance in April and May. to become a consistent producer which can deliver.”
The company reported 23,969oz gold produced in April and a That confidence is not without caution. Bramwell understands the
record 25,100oz the following month from its suite of mines in the current climate within the gold sector will present new trials with the
Bryah and Murchison districts. Those numbers will be enough to focus shifting from growth to maintaining margins.
hit financial year guidance of 270,000oz at AISC of $1,500-1,700/
“We have done well to get to steady-state but FY23 will present
oz.
a whole new series of challenges,” he said. “Now the focus is on
“In some sense we are a bit unusual in that our peers are winding costs, we need to walk and chew gum at the same time. In the
back guidance but we are on track to meet guidance, not that past, we have been overly focused on ounces and not profitability.
anyone seems to care,” Westgold managing director Wayne FY23 will be much more about profitability which means focusing
Bramwell told GMJ while staring at a share price which dropped on efficiencies and costs.
34% over the course of the June quarter.
“We don’t know what the magic bullet is but we are focusing
Bramwell, who migrated to the managing director’s role in May, on everything, whether energy, equipment utilisation or mill
said the strong production figures were built on the performance maintenance.”
of the Big Bell mine when mining rates exceeded 95,000 tpm in
Energy has been a major cause of price escalation in the WA gold
both months.
sector and Westgold is following the likes of Gold Fields Ltd in
“We achieved it because we have a good team in the field,” he attempting to lessen its reliance on increasingly expensive diesel.
said. “Big Bell, as the engine room of the company, is humming
“Twelve months ago, we saw where fuel was going and began
now, Starlight is kicking goals and Bluebird is boringly consistent,
planning a move away from 100% diesel,” Bramwell said.
which is not something Westgold has been able to say a lot down
In its March quarterly report, the company said it was well advanced
the years.”
in negotiations with a preferred tenderer for the diesel gensets to be
After developing the sublevel cave over FY21 and FY22, Big Bell
replaced by gas and renewable options.
is now in steady-state production, with the company now confident
“You will see in the next few weeks several contracts awarded for
it can exceed feasibility study levels, allowing it to churn through
renewables and gas supply,” Bramwell said. “That is a long-term
approach to cost and margin, there will be a real cost benefit in
FY23 and beyond, but we are also working on short-term initiatives,
and we have to get smarter about what we do.”
For Bramwell, that means taking advantage of the company’s
status as a multi-asset producer.
“We have not been good at leveraging the buying power of the
group,” he said. “We have often operated as single entities instead
of having a group purchasing strategy. We have been running that
process for 12 months now and are starting to see the changes.
In our underground contracting, we have a lot of equipment which
we have been trimming and optimising. It can look like the airport
carpark with different makes and models. We are standardising the
fleet to make it more efficient. It is all about those one-percenters.”
The new Sovereign discovery could allow for easier development As a counter to the group approach on purchasing, the company is
of the Great Fingalls and Golden Crown orebodies at Cue placing more responsibility on individual management teams.
(Pictured: Dalton Taylor)


Page 36

YOUR SUSTAINABLE REFINING PARTNER





“We are putting a bit more control into the mine operators’ hands,” gold resource.
Bramwell said. “Everything was perhaps a bit too centralised. A high-speed redevelopment of the Great Fingall decline is already
It is always a balance but we are making the operators more planned and the dual development of Golden Crown could be
responsible and accountable for costs.” aided by the recent Sovereign Reef discovery.
Maintaining current margins would add to Westgold’s cash “Everything pivots off the Sovereign drilling,” Bramwell said of a
reserves which were bolstered earlier this year by a $100 million target which has already returned hits of 8.5m @ 4.84 g/t and 8.55
capital raising. @ 1.87 g/t. “We are now accelerating the Sovereign programme to
The raising was designed to decouple growth plans from determine the potential of this linking reef structure and how it may
operational performance, allowing Westgold to set itself up for give us a different option for how we develop those orebodies.”
several years of expansion. Bramwell said that while the cash The Sovereign discovery is the first success of Westgold’s revised
injection wouldn’t result in a headline spend, funds were being exploration strategy which saw the company identify 14 high-
deployed. priority targets through a review of historical data.
“We will use that capital smartly over the next few quarters,” he Like the production consistency, the exploration results have
said. done little to inspire increased trading in the company’s shares
The priority is organic growth with the Fender underground mine, but Bramwell remains convinced investors will eventually notice
3km south of Big Bell, the first of several projects approved for Westgold’s improved performance.
development. “I’m not surprised by the market reaction, we know why we get
Fender is expected to deliver 30,000 ozpa at 2.8 g/t gold and will treated the way we do because we haven’t been consistent,” he
use Big Bell’s services and support infrastructure, making it a low- said. “But, I love the challenge and I am encouraging the team to
cost, low-risk proposition. At Bluebird, the company is preparing keep kicking goals because eventually there’ll be a breakthrough.
to start expansion from the current 24,000 tpa to 50,000 tpa from The market will eventually see Westgold as a company that can
FY24. be trusted to hit guidance consistently. Investors and analysts
However, it is Day Dawn and the Great Fingall-Golden Crown have told me it has been a complicated and erratic story but if we
project which looms as the most significant growth story at can change that perception, they will change their view and then
Westgold thanks to its combined 1.85mt @ 8.5 g/t for 500,000oz people will come back to the stock.”





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Page 37

Saturn:


Building its



own universe






The world around Apollo Hill
has changed quite a bit since
Saturn Metals Ltd (ASX:STN)
listed four years ago, but most
importantly for managing director
Ian Bamborough, so has the

company’s flagship gold project.















Located just 60km south-east of Leonora, Apollo Hill now vectors for higher-grade mineralisation. Results included
boasts a 76mt @ 0.6 g/t gold for 1.47 moz resource (0.23 g/t 10m @ 2.96 g/t gold from 126m and 3m @ 3.41 g/t gold
cut-off) contained entirely within a single, simple and large from 215m, and extended mineralisation along strike from
open pit shell. previously reported intersections.
Apollo Hill ticks every box for eligibility as a bulk tonnage A combination of aircore and RC drilling at Hercules, 17km
heap leach mining operation – grade, scale, low strip ratio, south-east of Apollo Hill, increased the strike length of the
excellent recovery, efficient cost structure – and while he is mineralised zone to over 3km with new intersections such as
satisfied the project’s foundational ounces are now clearly 4m @ 4.57 g/t gold from 54m, 4m @ 1.97 g/t gold from 64m,
outlined, Bamborough is hungry to find out what else exists 4m @ 1.44 g/t gold from 40m within 20m @ 0.57 g/t gold
on Saturn’s contiguous 1,000sq km ground package. from 24m. Saturn has planned infill drilling around higher-
“I’m really excited about the bigger picture which is grade intersections including 20m @ 2.27g/t gold from 24m
evolving around Apollo Hill and the corridor of mineralised including 8m @ 5.17g/t gold from 24m where drilling is still
opportunities we’re now starting to unlock on our very own broadly spaced.
tenure,” Bamborough says. New aircore drilling results at Aquarius, 25km south-east of
“Irrespective of what’s happening around us corporately, Apollo Hill, showed coherent zones of mineralisation that
we’re very focused on our own business and creating the best warrant further drilling. Significant intersections included
value we can for our shareholders by continuing to explore. 4m @ 1.86 g/t gold from 64m within 9m @ 0.69g/t gold from
We have some really strong gold intersections across our 64m and 4m @ 1.26 g/t gold from 72m within 12m @ 0.63g/t
ground package and now it’s a matter of us joining the gaps. gold from 68m.
“I just cannot believe we’re not going to find more gold Step-out aircore drilling at Artemis, 10km north-west of
along this corridor. There’s a very good chance something Apollo Hill, along trend from the discovery hole (4m @ 4.08
quite special is waiting for us out there.” g/t gold from 40m within 33m @ 0.73 g/t gold from 24m)
lengthened the system to 800m in strike. Best hits from
Bamborough’s enthusiasm for finding complementary gold
broad-space drilling completed to date include 4m @ 0.49
deposits adjacent to Apollo Hill only increased following a
g/t gold from 40m and 4m @ 0.53g/t gold from 60m.
series of promising drilling results over multiple regional
prospects, including Bob’s, Hercules, Aquarius and Artemis. “We now have a serious part of the greenstone belt where
All are within 25km of Saturn’s existing JORC resource. brand new prospects and trends are starting to emerge,”
Bamborough says.
Follow-up RC drilling at Bob’s, 7km east of the Apollo Hill
resource, returned several exciting intersections and further “The best bit is we now have two or three strong hits at
several prospects outlining strongly mineralised centres of
over 500m in strike length that need important infill and
extensional drilling. It’s worth pointing out that Gwalia
Deeps is 500m long so these are some incredibly significant
intersections in the scale of the gold system.”

Saturn is also preparing to send down a 1,200m pointing us in a direction which is hard to deny,”
diamond drill hole to test for expansions to Bamborough says.
the Apollo Hill system. Pre-collars for the step- “Everything sits in one simple, single, open pit
out and framework drilling exercise have been shell, which is in contrast to a number of our
completed. peers whose resource bases are quite often split
“We will change the scope of this gold through a number of pits, so there are some
system straightaway if we hit something,” huge efficiencies that are going to drive the
Bamborough says. economics of this project as we move through
“This is the kind of step-out thinking we need to the study phase.”
do now. We want to find a game-changer, not One of those efficiencies is certain to be the
incremental stuff, and whether there’s something low-cost recovery route which Saturn is very
feeding a potentially bigger gold system. But, in quickly establishing for Apollo Hill. The simple
the meantime, we’re going to really beaver away fresh rock, free gold in quartz mineralogy
at this deposit to try and optimise it and pull the which characterises the deposit has delivered
best out of it that we can.” recoveries of 80% in bottle roll and 73% in
Saturn has now added 964,000oz to the column testwork. The average recovery of most
Apollo Hill resource since completing its IPO in successful heap leach operations globally is 65%.
March 2018, including upgrading 760,000oz to Saturn is now undertaking further column tests
indicated status, representing 52% of the total to repeat those initial recoveries at much larger
mineral inventory. Importantly, the company has scales.
delivered and converted 7.5oz for every metre Bamborough expects the company to continue
drilled. improving the likely economics for Apollo Hill
A further resource upgrade is planned for as more opportunities for efficiencies to come
later this year, along with a range of ongoing to light, including those which dovetail into the
metallurgy and geotechnical work which will preferred heap leach mining scenario.
form the basis for what the company has termed “Heap leach can offer a variety of opportunities
a “stage gate” planning phase leading into a for an improved cost structure including
highly anticipated PFS for Apollo Hill. the potential for reduced water and energy
While there is still plenty of work to do, requirements, both of which have become very
Bamborough is confident a 10 mtpa heap leach topical for the industry,” Bamborough said.
mining operation delivering at least 100,000 “We’re now working on the full sphere of the
ozpa over eight years is possible for the current costs, looking to tighten every lever and just
resource. seeing what we can pull out of this. I think we’ve
“Apollo Hill has really come to its own forefront reached a completely new level now and the
as a standalone proposition. The deposit very team can really start to see the goal in sight.
much lends itself to a bulk tonnage proposition We’re most definitely in a very different space
and the metallurgy and the geology are both now and in control of our own universe.”






Apollo Hill has
really come to
its own forefront
as a standalone
proposition.






Saturn Metals Ltd (ASX: STN) Key people:

Market cap: $41 million Ian Bamborough (managing director)
52-week share price range: 30.5-65c Brett Lambert (non-executive chairman)
Address: 9 Havelock Street, Andrew Venn (non-executive director)
West Perth WA 6005 Rob Tyson (non-executive director)
Phone: +61 (0)8 6234 1114 Adrian Goldstone (non-executive director)
Email: [email protected] Natasha Santi (company secretary)
LinkedIn: @saturnmetals Phillip Stevenson (exploration manager)
Twitter: @saturn_metals

YOUR SUSTAINABLE REFINING PARTNER
DIGGERS & DEALERS PREVIEW











Musgrave right on Cue for



development





by Michael Washbourne

































The original Break of Day shaft


Musgrave Minerals Ltd has a problem of a good kind on its hands. While the
company is tantalisingly close to defining the critical mass it requires to officially
launch a PFS for its Cue gold project in Western Australia’s Murchison district, the
drill rig continues to turn up new discoveries which effectively reset the dial on any
development plans.


t is a conundrum most explorers or aspiring developers Waugh explained to GMJ.
Iwould love to have and certainly one which Musgrave has “We’re not expanding the existing deposits, we’re actually
openly embraced since making the first of several game- finding new ones, so we basically have to go back to scratch
changing discoveries at Cue over the past two years. at PFS level every time we make a new discovery on our
Musgrave managing director Rob Waugh has presided over ground, which is not necessarily a concept that the market
a number of conceptual mining operations for Cue since his fully understands.
company acquired the project from a struggling Silver Lake “The story at Cue has evolved quite a bit over the last seven
Resources Ltd in late 2015. He remains adamant the best years, but we’re in a position now where we’ve got a lot of
iteration is yet to come. background information for Break of Day and Lena which
“The thing about pre-feasibility studies is every single allows us to make a bit of a head start there. We don’t have
deposit you find needs its own PFS-level study on it,” that yet for the new discoveries of White Heat and Big Sky, but



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YOUR SUSTAINABLE REFINING PARTNER





we expect that level of activity will commence shortly.”
Rob Waugh
Cue firmed as a gold mine in waiting after Musgrave
announced a 41% uplift in total resources last quarter. The
overall project inventory now stands at 12.3mt @ 2.3 g/t gold
for 927,000oz, including a near-surface, high-grade trend of
982,000t @ 10.4 g/t gold for 327,000oz.
Maiden resource estimates were also unveiled for the Big
Sky (4.65mt @ 1.2 g/t gold for 173,000oz) and White Heat-
Mosaic (185,000t @ 11 g/t gold for 65,000oz) discoveries,
both of which have only been drill-tested to 120m and 160m
respectively.
Musgrave must now balance ongoing exploration with
feasibility work. To that end, the company has appointed
former Westgold Resources Ltd chief operating officer
Anthony Buckingham as general manager, development to
oversee the upcoming study phase and beyond.
Waugh said while an obvious pathway to production was
beginning to take shape, he wants to see the company bank
more ounces before confidently hitting the button on any form
of development.
“We think because of the grade and the shallow nature of the “Anything above 1 moz is a real stepping stone for us. It’s
high-grade mineralisation we have with Starlight and Mosaic- a point where we can draw a line in the sand and say, ‘OK,
White Heat that we will have a reasonable development we’ve got enough here for a standalone operation, let’s really
operation with good grades, good margins and good push down that development pathway and see where we go
recoveries, but it’d be even better if we can make it bigger,” with this opportunity, how big it can be and how quickly we
he said. can progress it to a development story.”
“We’re starting to build up towards that critical mass. There’s The fact Cue has reimagined itself on multiple occasions
no doubt the market loves 1 moz. It’s easy math – 100,000 under Musgrave’s ownership was not something Waugh
ozpa for 10 years – and obviously we’re now very close to anticipated when he and former exploration manager Ian
that, but we think there’s lots more exploration upside that will Warland settled on the project as the company’s new flagship
allow us to build the resource even further. asset seven years ago.
Musgrave’s initial plans were to build on the existing resource
base across the Break of Day and Lena deposits, while quietly
chipping away at some regional exploration opportunities on
offer. For the best part of four years, many speculated the
company would be confined to nothing more than a toll-
treating arrangement with the nearby Tuckabianna mill, now
owned by Westgold.
Interestingly, Silver Lake had originally packaged Tuckabianna
together with the Cue ground but Musgrave could not justify
the purchase price at the time.
Then, in early 2020 – just as the world was bracing for the
onset of the COVID-19 pandemic – a systematic look at the
geology brought attention to a particular drill result which did
not appear to fit the geological model that Musgrave and
others had been applying.
“It then became a question of whether we have the guts to
turn the rig around and drill a hole in a completely different
direction to every single other drill hole in the region for the
last 20 years,” Waugh recalled.
“There’s pluses and minuses with turning the drill rig around,
but sometimes you need to be brave and the outcome ended
Musgrave exploration manager Jonathan Gough up being a very positive one for us. It didn’t only just open it



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Waugh pans for gold samples
























Evolution Mining can earn up to 75% of the Lake Austin
tenements by spending $18 million on exploration over a five-
year period. Musgrave will retain 100% of the ground if that
expenditure commitment is not fulfilled


up for Starlight, we found new lodes and new orientations and response. Musgrave has certainly experienced that before.
White Light, White Heat and Mosaic all followed.” We had some earlier results at Break of Day where we hit
Musgrave was one of several WA-focused explorers, 20m @ 20 g/t and it was just the wrong time in the market.”
headlined by De Grey Mining Ltd and its monster Hemi find, While bonanza hits such as 18m @ 179.4 g/t gold are usually
to make significant gold discoveries in 2020 and there was enough to captivate the market, the near-surface nature of
certainly a period where the company was floated as the the mineralisation only enhanced Musgrave’s profile within
potential next “market darling”. resources investment circles.
Shares in Musgrave peaked at 76c in August 2020 either “Some of those grades were just 4m below surface,” Waugh
side of the company raising $6 million and $18 million for said. “We really haven’t seen anything that shallow in the WA
exploration and resource growth activities at Cue. While both Goldfields for a long time, decades potentially, so you can
gold and stock prices have come off since, Waugh remains understand why it grabbed shareholders’ and the public’s
thankful for that brief moment in the sun. attention.”
“It was almost the perfect storm with great results and a really Prior to the Starlight discovery and the chain of company-
good time in market,” he said. making events which followed, there were times when even
“We’ve seen in the past companies might have had good Waugh was questioning whether Musgrave had stalled in its
results, but the market has been flat and you don’t get the progress at Cue.




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YOUR SUSTAINABLE REFINING PARTNER







A geologist with more than three decades of experience, starting in gold and back there now,” Waugh said.
including stints with Western Mining and BHP Ltd, Waugh has “Taking a project from scratch all the way through to
come to appreciate the highs and lows that come with running development would be a fantastic thing for this company. But
a junior exploration company, especially during Musgrave’s for myself personally, my love and passion is exploration so I
formative years when the focus was on greenfields exploration can see myself transitioning away from a frontline position as
in the company’s namesake region of South Australia. managing director as we transition to a production company
“You always have these points in any development or any and having a person come in that is aligned and has a lot
project where you think maybe you’ve tested all the targets more experience in a production sense.”
and maybe that’s all there is,” he said. With plenty of exploration work still to come, there will be no
requirement for Waugh to contemplate such
a decision anytime soon, especially with high
inflation currently offering little incentive for
the development of new mines.
Waugh anticipates Musgrave has at least six
months of PFS-level activities to complete at
both Big Sky and White Heat-Mosaic before
committing to a full-blown feasibility study on
Cue.
“The inflationary side is certainly very
challenging at the moment, but it’s a bridge
we really don’t have to cross for another six
months or so,” Waugh said.
“From our point of view, we just need to focus
on this next six months and we can make
Musgrave non-executive director Brett Lambert (right) with some decisions after that, depending on what
senior exploration geologist Masha Pastuhov and exploration the outlook of the market is at that point in
manager Jonathan Gough time.
“Who knows, we might get lucky and add
“Exploration is truly a game of highs and lows and that some more deposits to the resource, in which case we’ll need
extends even to a daily basis, where you absolutely live and to do additional PFS-level work anyway.”
breathe every drill hole, especially as a junior. But, one drill
hole can also make a difference between a new opportunity
and a new discovery. So yes, you do hit those flat spots, but
then it’s about trying to get your energy up, looking at new
ideas, looking at it differently and coming back.
“All projects have a limit and companies will ask, ‘are
we throwing money away here, are we better off looking
something else?’. For where Musgrave is at right now, we
don’t think we’re anywhere near that point yet at Cue. The
team are generating new ideas every week, there’s still lots
more to be found.”
Alongside the growth of Big Sky and White Heat-Mosaic,
Musgrave has identified fresh targets at Amarillo (11m @ 8.4
g/t gold from 66m and 7m @ 23.7 g/t gold from 102m) and
Waratah Trend (2m @ 28.1 g/t gold) to keep the company’s
incredible run of exploration success ticking over.
In some respects, a move into the development sphere for
Musgrave will take Waugh’s career full circle, having begun
professional life as an open-cut gold mine geologist in
Norseman before moving to the Scotia underground mine.
“My first four years were in mine geology and then in exploration
for the 25 years since, across multiple commodities, but Musgrave’s discovery of the Starlight lode in early 2020 was a
game-changing moment for the company


Page 43

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DIGGERS & DEALERS PREVIEW



Hold your applause…




by Fraser Palamara


elease of a DFS is usually met with great fanfare, and while For Kingston, it has softened the celebration of Misima’s DFS
RKingston Resources Ltd managing director Andrew Corbett which in June delineated 2.4 moz gold production over 20
is proud of the outcome of studies into the Misima gold project in years at AISC of $1,217/oz would generate a NPV of $956
Papua New Guinea, the current financial climate has him eager million, based on a $US1,800/oz gold price. The project will
to see further improvements. also produce 5.6 moz silver and is expected to churn out up to
“We’re very happy with the result of the DFS in terms of it being 130,000 ozpa gold.
a technical and robust project,” Corbett told GMJ. “Misima is Corbett’s frustrations with the market are understandable
going to be a large-scale, long-life asset. We’ve got a 20-year given the rollercoasting gold price which has fallen as low as
mine life and we haven’t even finished drilling. It’s a big project. $US1,726/oz and ridden as high as $US2,052/oz in the past
“What we’re not happy with is the inflationary environment with year alone. This, combined with the inflationary cost pressures
the capital but I think we’re not unique there, that’s impacting the that have affected project capex, has made it hard to pin down
whole industry.” development fundamentals.
After years of almost unstoppable success, growth in the gold In combatting this, Kingston will take a second look at Misima as
market has ground to a halt of late, weighed down by multiple it focuses on accruing permits in the meantime.
factors including the COVID-19 pandemic, labour shortages, “We’ve got at least a year, possibly more, before we get the
inflation and cost increases. approvals,” Corbett said. “We’re not building it now, so that’s one
The resulting effects have softened the sentiment on producers, positive for Kingston shareholders in that we don’t have to rush
explorers and developers with many retail and institutional to get into FID or FEED engineering. We have to get approval,
investors being more cautionary with their spending. which will take 12-18 months, at which point we have to reprice
the project anyway.



Mistletoe Mining Pty Ltd The tenements are immediately East of the
high-grade Andy Well gold deposit with the
Asset Acquisition Opportunity Turnberry prospect along strike to the south.
They surround an old historic mine that is said
to have produced around 490oz of gold from
444t of mined ore.

Mistletoe, a privately owned gold exploration and development Air core drilling has recently been completed
company, wishes to divest a parcel of contiguous tenements and target areas identified for the next stage of
located within the Murchison Provence and sited at the northern discovery. A budgeted Programme of Work for
end of the Gnaweeda Greenstone Belt.
this phase has been approved by the DMIRS.

The offering is deemed a highly valued asset
Region highly AC drilling Follow-up Programme Geological for an ongoing exploration and development
prospective program target areas of Work & historical programme and presents an opportunity in a
to gold recently defined approved data room
mineralisation conducted available highly prospective terrane to host economic
gold mineralisation.


For copy of an Exploration
& Development Overview,
contact:

Tenement Solutions
[email protected]
or call 0407 813 512







Page 44

YOUR SUSTAINABLE REFINING PARTNER





“While we’re doing that, we’re also running a strategic review Some of the standout ASX mid-tier gold producers have taken
and looking for a partner to help build it both financially and a hefty bite to their share price most noticeably St Barbara Ltd
technically. Hopefully in that period of time, some of the inflation which tumbled more than 37% in one month to trade at 75c/
will wash through the system for things to settle down.” share.
Misima previously ran for 15 years from the 1980s and was St Barbara’s hiccup came after consecutive quarters of sliding
successfully producing at the lower end of production and the decision to place one of
the cost curve. With that in mind, Corbett its expansions under strategic review.
is confident the gold market’s current woes Corbett said patience would be an important
will pass for Misima to come out swinging virtue from shareholders and was proud of
when the time is right. Kingston’s register.
“As I’m coming up to now nearly 30 years “I think most shareholders are very
of experience, [I know] these things always patient because everything always takes
come in cycles,” he said. “We are seeing a longer, so they have been very good and
lot of commodities pull back at the moment, understanding. Everyone is getting a bit
I think this is cyclical, we’ve had a good run. frustrated out there [in the wider market];
There will be a short period of re-adjustment drill results are taking too long, getting
and then it will go again. people is taking too long, it’s costing too
“Ultimately, I’m not concerned in the much to get people and building projects is
medium-to-long term, the short term is not only costing money but the time to build
Andrew Corbett
always harder to predict but I’m also very them is also blowing out as well because
confident where the mining sector is going, people can’t get resources.
I think gold looks outstanding at the moment. “But the Kingston shareholders have been very patient and
“That being said, it is a tough environment right now. Look at the understanding.”
share prices of all the large gold producers, they’ve all pulled
back.”



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Medallion



firms as a




household



name










by Michael Washbourne


t might not have attracted the same headlines as Evolution
IMining Ltd’s acquisition of Cowal or Peter Cook’s proposed
spin-out of Westgold Resources Ltd but behind the scenes
at the 2016 Diggers & Dealers, Paul Bennett’s company-less
name badge proved to be quite the talking point.
Having spent almost a decade in the banking game, Bennett
One of those interviews was with the unlisted ACH Minerals,
was eyeing a return to the resources industry and decided
which had recently acquired the Ravensthorpe gold project
to purchase a full delegate pass for the annual three-day
from Silver Lake Resources Ltd.
talkfest in Kalgoorlie as his way of initially getting back in
Bennett would end up becoming the company’s managing
front of leaders in the mining and exploration sectors.
director and second employee after exploration manager
Perhaps most critically for Bennett, his prized delegate pass
David Groombridge, who came across from Silver Lake and
displayed only his name, instantly striking up conversations
has been directly connected to the project since 2011.
with anyone who asked as to why he was not attached to a
Aside from being impressed by Groombridge and project
particular company.
incubator Ed Ainscough’s intimate knowledge of the asset,
“Back then, it was the greatest conversation starter you
Bennett was also immediately drawn to the high-grade gold
could ever imagine,” Bennett told GMJ.
and copper and strong continuity of mineralisation he could
“I had actually intended to stay for the full three days and see from his quick look inside the dataroom.
attend the Gala Dinner, but within the first two days I had that
“Being a mining engineer, I felt those were the two most
many interviews lined up back in Perth, I jumped in my hire
important elements of a story,” he said. “Because it had the
car and drove back to the city.”
grade and the continuity, that’s why I chose this particular
opportunity. I thought there was a very good chance of
building something out of this.”
Over the next four years, the company would undertake a
feasibility study based on the existing 621,000oz resource
base. ACH was also rebranded as Medallion Metals Ltd
ahead of a proposed IPO in late 2020.
The feasibility study forecast average production of 61,000
ozpa over a minimum 5.5-year mine life. At the time, Bennett
and the Medallion team were confident there was enough
substance to what it now calls the Kundip mining centre –
Medallion exploration manager David Groombridge was the less than 20km south-east of the Ravensthorpe township –
company’s first employee, having crossed from Silver Lake to justify an ASX listing and begin a likely two-year journey
which owned Kundip from 2011-2016 to pouring first gold.
Investors shared a different view, however.


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YOUR SUSTAINABLE REFINING PARTNER












“When we presented the southern end of Harbour View.”
feasibility study findings to the Another resource update is scheduled for later this year
market, we got pretty direct once results from a further 19,000m of drilling already
feedback that it wasn’t big completed across Kundip and some regional targets have
enough and needed to be been reviewed.
bigger,” Bennett said.
Bennett wants to see more gold built into the total inventory
“We were confident the before the company progresses to the next stage.
resource would grow, but we
“On a gold equivalent basis, we’re closer to our critical mass
thought that would happen
than we thought we would be, but internally we think we
during production. Our plan
need to be around 1.5 moz straight gold, because the gold
was always to do more drilling
drives the economics here and the copper enhances them,”
at depth once we were in
he said.
production, but the market told
“The logic there is if 50% of that resource converts to mine
us very clearly in 2020 that we
plan, that’s around 700,000-800,000oz gold in reserve,
didn’t yet have the scale, and so
which is 100,000 ozpa of gold production for 7-8 years. We
we had to absorb that feedback
think that is a bankable project in WA in this market, so that’s
and come back with a resource
why we’re working towards that threshold.
growth story.”
“Obviously there’s still some way to go there, but we’ve
The IPO was restructured as a
done another 20,000m of drilling which should lead that next
result and Medallion informed
round of growth.”
the market its initial plans now
involved completing more than 30,000m of drilling with the While nothing had been set in stone at the time of print,
ultimate aim of growing the Kundip resource beyond 1 moz. Medallion is expected to target extensions to known
Argonaut Ltd led the revised $12.5 million float and the resources, near-mine opportunities within the existing
company’s stock eventually debuted on the ASX in March Kundip mining lease and further regional prospects – in that
last year.
Some 46,000m of drilling has since been completed at
Kundip. In June, Medallion announced a 79% uplift in the
resource which now totals 16.45mt @ 2.6 g/t gold equivalent
for 1.37 moz (1.1 moz gold and 50,000t copper) from more
than 26,000m of that drilling. The updated estimate also
contains 64% more gold (79% on a gold equivalent basis)
than the previous estimate, including 67% in the indicated
category and 80% within 150m of surface.
Bennett said the latest resource announcement – which saw
new ounces added for a discovery cost of just $11/oz, on a
gold equivalent basis – had exceeded most of the Medallion
team’s expectations, in particular the results from Harbour
View which all but confirm the material copper credit potential
of the project.
“It’s clear the orebody’s changing at depth and to the south,
with copper becoming a more dominant feature of the
orebody…it’s changing the way we think about things there,”
he said.
“If you look at the historical production across the field, the
area has produced 130,000oz gold and 20,000t copper
metal, and the gross metal value of those today is roughly
a 50/50 split between copper and gold. So, copper has a
bigger role to play here. We’re not really sure what it is, but
Medallion managing director Paul Bennett
it looks to be manifesting itself in some way down at the



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Ravensthorpe has historically produced 130,000oz gold and
20,000t copper


order of priority – as part of its next drilling campaign. and they either didn’t have this critical mass of Kundip to
Bennett believes the company is at least 12 months away underpin it or they had Kundip and nothing else,” Bennett
from any formal development decision – a timeframe which said.
could prove beneficial given the ongoing labour constraints “More recently, even though it had been brought together
and inflationary cost issues largely deterring any new by Homestake and Tectonic, the former owners had never
construction projects. made it the flagship asset in their business and so it always
“Being in a resource growth phase is the right phase to be in lacked focus and investment because it was a gold project
at the moment because it’s very hard to pull together a team inside a nickel producer, or a gold project inside a base
and assemble the resources you need to build something metal developer, or a gold project inside a gold company
just at this point in time,” he said. that had competing corporate priorities, meaning it was often
relegated to the back of the field.
“Where things are in 12 months, I’m not really sure…but at
some point we will get to a critical mass where you have to “When I was looking to join the company, I got the sense the
commit to the development and there’s not likely to be any owners were hell bent on pushing the gold and copper as an
point in drilling it further.” absolute priority and I believed – and I still believe – that was
the right approach.”
Development of a new mine in Ravensthorpe would be
a huge boon for the Great Southern region, which is no Bennett also believes the company is well on the way to
stranger to large resources operations, including First shrugging off the two main historical concerns associated
Quantum Minerals Ltd’s Ravensthorpe nickel operations with the project, being scale and metallurgy. The latter
and Allkem Ltd’s Mt Cattlin lithium mine. received a major tick following an extensive review by GR
Engineering Services Ltd of the two major banks of work
Medallion will be the first company to prioritise gold
previously undertaken by Tectonic in 2005 and ACH in 2018
development in Ravensthorpe for more than 20 years. Prior
which indicated high and consistent gold, copper and silver
to that, the tenure had suffered from fragmented ownership
recoveries could be achieved using an industry-standard
despite successful mining operations running across the
processing route.
district.
The Medallion team is also keeping a close eye on current
“Up until we took hold of the ground, no one has ever had the
gold developments in WA, with no one barracking louder for
opportunity to take a global view of the Annabelle volcanics,
successful outcomes than Bennett.
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YOUR SUSTAINABLE REFINING PARTNER












“We are really hopeful those projects in the development
and commissioning phase at the moment shoot the lights
out because if they do, it will be a tremendous shot in the
arm for the junior sector,” he said.
“I’m sure there have been some harsh lessons learned
from past hiccups, they’ve been absorbed and people will
be endeavouring and working their hardest not to see them
happen again.
“One of the reasons why our board looks the way it does is
because we want to be able to manage those risks when that
time comes for Medallion. Whilst the board is not complete
at this stage, the experience and the skillsets we need to
manage that development phase are there for when that
time comes.”
























































Remnants of the historical mining activities across Medallion’s
280sq km ground package


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DIGGERS & DEALERS PREVIEW






Hamelin




hunts major




discovery




Hamelin exploration manager Clayton Davys, graduate
geologist Flynn Cameron and managing director Peter Bewick
at the Camel prospect, West Tanami project by Michael Washbourne

amelin Gold Ltd managing director Peter Bewick finds it and graduate geologist Flynn Cameron from Adelaide.
H“bizarre” that a field hosting one of the world’s greatest gold DDH1 Drilling and Strike Drilling have both had rigs up in the
discoveries still remains an unconquered frontier. Tanami for Hamelin’s maiden exploration campaign which was
Spun out from Encounter Resources Ltd via a $10 million eligible for EIS co-funding from the WA Government.
IPO last November, Hamelin is chasing a multimillion ounce “We’re learning more about the system every time we put one
discovery on its 2,277sq km land position in the West Tanami. of these diamond holes in the ground so that EIS co-funding
Newmont Corp’s 14 moz Callie gold mine remains the only is absolutely fundamental to our first-year programme,” Bewick
active operation in the Tanami region which until recently was said.
largely void of junior exploration companies. New arrivals such “Both Encounter and Hamelin are basically working in those
as Hamelin, PVW Resources Ltd, Killi Resources Ltd and Black areas which are frontiers and, there’s no doubt about it, the
Cat Syndicate Ltd are seeking to change that dynamic. West Tanami is a frontier where you’ve got all the ingredients
For seasoned campaigners Bewick and recently-appointed and the potential to find giant gold deposits. We’re collecting
Hamelin exploration manager Clayton Davys, travailing through data in areas where the State has no real understanding of
the Tanami is as much an opportunity as it is a challenge. what’s going on at depth.
“It’s bizarre that this field holds one of the world’s greatest gold “Whilst I don’t want to take it for granted, these grants are very
discoveries at the moment – the Newmont Tanami operations – competitive, if diamond drilling can be done with co-funding, it
yet 100km away we’re dealing with areas that didn’t even have means the shareholder dollar goes a lot further and the State
detailed magnetics, any deep drilling or any understanding of learns a lot more than just continuing to do the same thing over
structural geology before we got there,” Bewick told GMJ. and over, which is usually shallow drilling which no one is really
“To be successful in the Tanami, you need to understand the learning much from.”
geology and you need to understand the structural architecture Hamelin’s priority prospects at West Tanami include Bandicoot,
of your projects. We’ve got eight advanced gold prospects Quenda, Camel and Fremlins, which the company only picked
where shallow drilling has outlined multi-kilometre scale, near- up the day before launching its IPO.
surface gold anomalies, but there’s been no work done to try As has typically been the case throughout his own career,
and find out why that anomaly is there. Bewick has set the bar very high for Hamelin to rapidly advance
“Prior to us picking up the ground, there’s only two drill holes at least one of the prospects in the portfolio by the end of its first
deeper than 200m over the whole area. It’s really underdone field season.
exploration so that’s the opportunity but it’s also the challenge, “I’d love to be in a situation in 12 months’ time where we’ve
but. We think certainly the footprints which have been outlined committed to a resource drill-out programme on one of those
are what could host multimillion ounce-type positions.” projects that can re-rate the company and position us as
Explorers such as Hamelin have not been immune to the a different beast and not as an explorer but as a developer,”
challenge of attracting skilled labour to aid the search for a large Bewick said.
gold discovery at West Tanami. Bewick said luring Davys to “Up here, that can happen with basically two or three drill holes.
the company from Gold Road Resources Ltd was a huge boon You can really change the belief of one of these projects by
given his experience in greenfields projects and ability to train getting some continuity; consistent mineralisation at the sort of
young talent. grade that we know this area produces. These are big systems
Supporting Bewick and Davys on the ground is senior geologist and I’m pretty confident if we can get onto one and understand
Oisin McFadden, most recently of Silver Lake Resources Ltd, it, we’ll add ounces pretty quickly.”


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