Name of the Project
Gruyere gold project.

Location
The project is located in the Yamarna greenstone belt, about 200 m east of Laverton, in Western Australia.

Client
Gold Road Resources.

Project Description
A feasibility study on the Gruyere project has confirmed it as one of the longest-life, lowest-cost undeveloped gold deposits in the world, with an estimated mine life of 15 years.

The project has total proven and probable reserves of 91.6-million tonnes grading 1.2 g/t gold.

Development of the project is based on a single, large openpit mine and conventional semiautogenous/ball mill circuit, gravity/carbon-in-leach plant, with throughput of 7.5-million tonnes of fresh ore a year and up to 8.8-million tonnes of oxide ore a year.

Mining activities will be undertaken by a mining contractor, with technical and managerial direction provided by Gold Road.

The feasibility study proposes that the pit be mined in four stages. Stages 1 and 2 comprise two independent pits in the northern and southern ends of the deposit.

Stage 3 will combine the two starter pits and Stage 4 will cut back to the final pit design.

Jobs to be Created
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate, of A$486 million and an internal rate of return of 24% at a A$1 500/oz gold price. At a A$1 750/oz gold price, the NPV increases to A$910-million, with an internal rate of return of 35%.

Value
The project has a forecast capital cost of A$507-million.

Duration
The project’s execution is based on a five-month early works programme, immediately followed by a 24-month construction and commissioning timeframe, with the objective of achieving first gold production by the end of 2018.

Latest Developments
Western Australian Environmental Protection Agency (EPA) chairperson Dr Tom Hatton has recommended that Environment Minister Albert Jacob approve junior miner Gold Road Resources’ Gruyere gold project.

South Africa-based gold major Gold Fields recently entered into a joint venture with Gold Road to acquire 50% of the project. Gold Fields will pay A$350-million in cash and a 1.5% royalty on its share of production after total mine production exceeds two-million ounces with an estimated value of A$15-million.

Hatton has said an independent board assessed the potential impact of the Gruyere proposal according to two key environmental factors – subterranean fauna and flora, and vegetation.

“In assessing this proposal, the EPA examined potential impacts to stygofauna habitat and species from the abstraction of groundwater from borefields and the direct impact of clearing 2 260 ha of flora and vegetation. The EPA concluded the proposal was able to meet the EPA’s objectives, and therefore, recommended approval subject to a set of conditions.”

The conditions include the requirement to prepare and implement a subterranean fauna management plan to ensure groundwater abstraction is managed to protect the biodiversity and ecological integrity of subterranean fauna.

The public appeal period will close on December 5.

The Gold Road board has approved the feasibility study and progression to construction on completion of an appropriate financing strategy. The company expects to be in a position to complete the funding aspects of the project and make the associated investment decision in early 2017.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Gold Road Resources, tel +61 8 9200 1600, fax +61 8 9481 6405 or email perth@goldroad.com.au.