AustraliaMurchison production set to start in JuneConstruction work at Kentor Gold’s Murchison project in Western Australia.Edna May underground resource up 70%NEWLY-formed mid-tier gold producer EvolutionMining has reported a 70% increase in theunderground mineral resource at its Edna Maygold operation in Western Australia. <strong>The</strong> companysays the total indicated and inferr ed resourceof 1.2 million tonnes @ 7 grams/tonnehosts 270,000 ounces of contained gold.Evolution completed a successful drill programin 2011 with 19 diamond holes totalling10,303 metres resulting in the significant resourceupgrade and extension to the mineralizationat depth. <strong>The</strong> underground mineralresource has been defined to a depth of 550metres below the surface, with infill drilling todate prioritizing the upgrade of inferr ed resourcesclose to the existing decline beneaththe open pit operation.Two main areas of mineralization were identifiedby the drilling, including high gradequartz reef mineralization, which hosts an estimated490,000 tonnes @ 8.8 grams/tonnegold for 140,000 ounces of gold. Halo mineralizationwas also identified with an estimated720,000 tonnes @ 5.8 grams/tonne gold for130,000 ounces of gold.Evolution’s executive chairman Jake Kleinsays, “This is an encouraging addition to ourefforts to maximize the value of Edna May .Our focus at the operation over the next 12months remains improving the reliability andperformance of the plant, but undergr ounddevelopment represents an option for addingGOLD production is on schedule to commencein June at Kentor Gold’ s Murchisonproject in Western Australia, after the companyintersected high grade gold mineralizationin its latest drill pr ogram. Two diamonddrill holes within the Lewis pit shell have assayed5 metres @ 102.2 grams/tonne goldfrom 43 metr es and 17 metr es @ 9.6grams/tonne gold from 43 metres.<strong>The</strong> company’s managing director SimonMilroy says “<strong>The</strong>se extraordinary drill resultssuggest that the Lewis pit may be of significantlyhigher grade than the current resourcemodel indicates, and there is the potential toachieve higher gold pr oduction and lowercost per ounce than we have currently scheduledfor the phase 1 operation.”<strong>The</strong> top 30 metres of the holes is yet to beassayed, as it is not part of the initial targetzone. Kentor says a RC drill pr ogram nowunder way will provide information regardingthe size of the high grade area.<strong>The</strong> 47.5sqkm Murchison project is about50km south of the town of Meekatharra andcomprises the Bur nakura gold and Gabaninthagold-copper sites. A first phase pr o-duction schedule will see 24,000 ounces ofgold produced annually from the Lewis andReward pits at Burnakura.While previous owners mined the Lewis pitto a depth of 20 metres, Kentor plans to extendthe depth to 50 metres to realize the potentialof mineralization within quartz veinstockwork that’s hosted by coarse grainedgranitic rock comprising quartz and potassicfeldspar. <strong>The</strong> site has an historic undergroundproduction of 50,637 ounces of gold, while216,254 ounces of gold were produced fromthe open pit until 1998 when the operationceased due to falling gold prices.Kentor has built a newly-r efurbished basecamp for up to 90 employees and purchasedan Indee heap leach plant. Simon Milroy saysbringing Murchison to production will helpKentor step up from its emerging status as amid-tier gold company. He says there is alsopotential for the neighbouring Gabanintha depositto provide additional gold pr oductionopportunities in the near future.Meanwhile, a scoping study has found thatKentor’s Jervois Copper-Silver-Gold Project inthe Northern Territory will be a r obust projectproducing strong financial returns. <strong>The</strong> studyexamined annual processing rates of 1.5 milliontonnes, 2 million tonnes and 2.5 million tonnes.<strong>The</strong> completed scoping study indicates lifeof-minecash operating costs range fr om$1.79/pound of payable copper at a 1.5 milliontonnes throughput to $1.61 at a 2.5 millionthroughput, after by-product credits. It showeda pre-production capital cost estimate of $230million, including $32 million of contingency for1.5 million tonnes through to $310 million for a$2.5 million tonnes throughput with open pitmining for the first thr ee years and under -ground mining for years 3 to 7.value to the long term future at Edna May.”<strong>The</strong> company is yet to commit to developingthe undergr ound opportunity, as itawaits the outcome of a number of initiativesto improve the plant performance and sustainablyincrease throughput. Evolution saysthese measures are expected to be establishedduring the next 12 months.Edna May has been mined since the 1950sand was closed for almost 20 years between1992 and 2009, when Catalpa Resour cesconstructed the processing plant.Evolution was established in late 2011through a merger of Catalpa Resources andConquest Mining. It owns and operates fourgold and silver mines.50 | <strong>ASIA</strong> <strong>Miner</strong> | May/June <strong>2012</strong>
AustraliaGOLDEN Cross Resources has completedthree twin PQ & HQ core holes to confirm itsearlier reverse-circulation (RC) drill programresults at the Spur-Dalcoath deposit withinthe Cargo Gold Project in Central West NewSouth Wales. <strong>The</strong> company says the r esultsagain confirm the coher ent distribution ofgold mineralization and support the basis forthe pit optimization study.An RC drill program in February and Marchtested near-surface gold intersections fromprevious exploration at the Spur-Dalcoath depositof 17 metres @ 5.3 grams/tonne gold,2 metres @ 44 grams/tonne gold and 16 metres@ 3.86 grams/tonne gold.<strong>The</strong> Golden Cross drilling yielded a best intersectionof 9 metres @ 2.07 grams/tonnegold from 41 metres which occurs within abroad zone of mineralization. <strong>The</strong> companyhas now asked consultants to estimate a resourcefor in-house use, based on the 112holes from the Spur-Dalcoath lodes.<strong>The</strong> PQ & HQ holes have returned near-surfacegold intersections of 13 metr es @ 3.99grams/tonne gold and 26 metr es @ 1.87grams/tonne gold within broader zones of 55metres @ 1.27 grams/tonne gold and 67 metres@ 1.15 grams/tonne gold respectively. Selectedcore from this program will form the basisof metallurgical test work to determine gold recoveriesfrom a range of processing options.Golden Cross managing director Kim Stanton-Cooksays, “<strong>The</strong> results from the threecored twin holes versus the RC drill holeswere very satisfying with all showing r easonablecomparisons. It should be noted thatthe core holes yielded slightly better results.”Four large diameter PQ & HQ core holes werealso drilled at the Gum Flat deposit to pr ovidegeological data for planning follow-up drillingwhich is essential for later JORC-compliant resourcedefinition. Shell Metals drilled Gum Flatin 1985-87 with best r esults including 18 metres@ 1.48 grams/tonne gold and 13 metr es@ 2.41 grams/tonne gold. Golden Cross sayswhile the tenor of these historical intercepts wasconfirmed, overall cor e intercepts were of alower grade than the historical results.<strong>The</strong> Cargo goldfield is about 15km west ofthe Cadia-Ridgeway gold-copper pr ojectnear Orange and about 50km from the company’sflagship Copper Hill pr oject whichcontains 500,000 tonnes of copper and 1.35million ounces of gold.Cargo drilling supports basis for pit study<strong>The</strong> Cargo site has been mined intermittentlyfor almost 150 years. Pr evious explorers,including Billiton Australia and CyprusGold, drill tested numerous anomalous goldzones in the 1970s and 80s and defined potentiallypayable bodies of near-surface goldmineralization. Golden Cross carried out extensivedrilling in the 1990s.Initial pit optimizations, based on the CyprusGold and Golden Cr oss drill data andusing current gold prices, show clear potentialfor an economic resource to be defined.May/June <strong>2012</strong> | <strong>ASIA</strong> <strong>Miner</strong> | 51