JOHANNESBURG (miningweekly.com) – Junior Genesis Minerals is planning to start mining at Ulysses gold project near Leonora, in Western Australia, in late September, the ASX-listed company reported this week, announcing the positive outcomes of a feasibility study and the completion of mining agreements.
Mining will start at the Ulysses West openpit – the first openpit to be completed at the project. A feasibility study has demonstrated that Ulysses West is “technically and commercially viable” and has the potential to generate “strong” cash flows over a short time frame, allowing the company to fund the development of the larger project.
The feasibility study estimated ore reserves of 74 000 t at 4.1 g/t of gold for 9 700 oz of contained gold for Ulysses West.
Genesis has also entered into a mining alliance agreement with mining contractor SMS Innovative Mining to develop and mine the Ulysses West openpit. The agreement, which Genesis MD Michael Fowler said significantly de-risked the initial development at Ulysses, covers haul road construction, mobilisation of equipment, site establishment, drill and blast and the load and haul of waste and ore. SMS will also provide $2.5-million through a mix of equity and debt funding to support the development of the initial openpit at Ulysses West, subject to shareholder approval.
In addition, Genesis has executed a letter of agreement with Paddington Gold, a subsidiary of Norton Gold Fields, for the treatment of ore from the openpit at the 3.5-million-tonne-a-year Paddington mill. The mill is about 160 km from the Ulysses project and ore will be transported using Paddington’s preferred haulage contractor.
Meanwhile, Genesis has received firm commitments to raise up to $1.71-million in a placement to sophisticated and professional investors by issuing 68.4-million shares at $0.025 a share.
The proceeds of the placement, which was oversubscribed, will be used for working capital requirements to start mining at Ulysses West and for the continued exploration of the Ulysses and Viking projects.