Name of the Project
Dalgaranga gold project.

Location
The project is located in the Dalgaranga greenstone belt, in the Murchison province of Western Australia.

Client
Gascoyne Resources.

Project Description
The Dalgaranga project contains an updated mineral resource of 31.1-million tonnes grading 1.3 g/t, and includes an updated proven and probable mineral reserve of 14.3-million tonnes grading 1.27 g/t. 

The updated mine plan excludes the Sly Fox mineral resource of 77 000 oz, which is expected to improve the production profile in years 3 and 4.

As a result of the updated mineral resource announced in March, the mine plan, design and schedule have been updated to align production with the increased throughput rate that modelling has shown to be achievable while processing soft oxide and transitional ore in the early years.

The project comprises two opencut mines, a new conventional semiautogenous (SAG) milling circuit and a gravity and carbon-in-leach (CIL) processing plant with a throughput capacity of 2.5-million tonnes a year.

The processing plant will be located adjacent to the existing waste dump, to the east of the Gilbeys openpit, to minimise mine haulage costs.

The new mine design for the Gilbeys deposit has resulted in the Dalgaranga production target being increased to 15.3-million tonnes grading 1.3 g/t gold for 623 000 oz within the deposit, including the Gilbeys South and Golden Wings openpits.

As a result of the revised mine design and schedule, along with the increased throughput in the early years of the operation, a revised production target has been developed. The new production schedule will result in the project producing 244 000 oz in the first two years of operation, representing an increase of more than 35 000 oz in the first two years of production, compared with the feasibility study mine schedule, and is expected to improve project economics significantly.

The project has an initial mine life of six years.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate, of A$177-million and an internal rate of return of 65%, based on a A$1 600/oz gold price, with a payback of 18 months.

Value
Preproduction capital costs for the processing plant and associated infrastructure are estimated at A$86-million, including contingencies of $6.1-million.

Duration
Subject to conditions being met, the Dalgaranga project is scheduled to start ore commissioning in the second quarter of 2018.

Latest Developments
Gascoyne Resources has appointed fellow-listed NRW Holdings as the preferred mining contractor for a $300-million contract at its flagship Dalgaranga project.

The openpit contract, which is subject to the finalising of terms and conditions, will cover four pits over a six-year period.

NRW will initially have 160 personnel on site, with a peak employment of 200.

Key Contracts and Suppliers
GR Engineering (processing plant).

On Budget and on Time?
The project is currently within budget and on time.

Contact Details for Project Information
Gascogne Resources, tel +61 8 9481 3434, fax +61 8 9481 0411 or email admin@gascoyneresources.com.au.