JOHANNESBURG (miningweekly.com) – African Consolidated Resources (ACR) has confirmed that trial mining at its Zimbabwe-based Pickstone-Peerless gold mine is well under way, with the aim of having a 20 000 t/m oxide operation in production by the first quarter of 2014.
Trial mining was being advanced in conjunction with a definitive feasibility study on a 20 000 t/m openpit operation, which was due for completion by the end of June.
ACR was also progressing a prefeasibility study on a 50 000 t/m openpit operation and underground mining concept study to be completed in the third quarter of this year.
The 584 ha Pickstone project, located 100 km south-west of Harare, had historically produced over 400 000 oz of gold.
Its current Joint Ore Reserves Committee-compliant resource was estimated at 10.57-million tons at 1.5 g/t, of which 63 000 oz were tailings, which ACR believed could be quickly added to through systematic drilling, particularly at depths below the current shallow resources.
In addition, ACR said it would submit a proposal in advance of the legal requirements of the Zimbabwe Indigenisation Act, which would, in particular, confer benefits to the local community surrounding Pickstone.
The projected direct capital expenditure to commission the 20 000 t/m operation would amount to some $17-million.
The company’s cash resources at March 31 stood at $11-million.
ACR detailed in a recent investor presentation that sources of funding to minimise any recourse to shareholders were likely to include, in addition to the company's current cash resources, a South Africa Department of Trade and Industry project grant and profits from the sale of its Harare office.
Additional funding for Pickstone’s development would be sourced from the cash flow from trial mining, the potential sale of tailings, forward sale agreements and/or debt finance.
ACR, which recently appointed Craig Hutton as CEO, would also look to fast-track the exploration and development of its other Zimbabwe assets.