PERTH (miningweekly.com) – Gold miner Doray Minerals on Thursday increased its 2015 production expectations for the Andy Well operation, in Western Australia, o the back of a 67% increase in the openpit mining inventory at the Wilber Stage 2 openpit operation.
The mine was now expected to produce between 85 000 oz and 90 000 oz during the full 2015, compared with the previous estimation of between 77 000 oz and 85 000 oz.
MD Allan Kelly told shareholders that the significant increase in size of the Stage 2 openpit, which was now estimated to host some 23 500 oz, along with the potential to mine previously unbudgeted ounces at the Suzie zone, was further proof of the potential upside at the Andy Well operation.
Realignment of a portion of the Great Northern highway started in November this year, with mining of the Stage 2 openpit scheduled to start in January, and to be completed by July.
However, recent drilling from the nearby Suzie zone has indicated the potential for additional high-grade material, which could be exploited as part of the Stage 2 openpit operation.
Kelly said that given the increase in size of the mining inventory, it was expected that processing of ore from the Stage 2 openpit would likely extend from late in the march quarter, until early into the September quarter.
Underground mining at Andy Well would also continue as planned, thereby increasing the inventory available for processing during 2015.
Meanwhile, Doray was expecting a one-off expense in relation to the realignment of the Great Northern highway and the initial pre-stripping of the Stage 2 pit. However, based on the improved results to date, the full year cash operating costs for 2015 were expected to range between A$600/oz and A$700/oz, compared with the previous guidance of between A$700/oz and A$800/oz.
Doray recently launched a takeover offer for fellow-listed Mutiny Gold, offering that company’s shareholders one of its own shares for every 9.5 Mutiny shares held, valuing Mutiny shares at 5.4c each.
To date, Doray has secured more than 60% shareholding in the takeover target.
The offer would close on January 23.