JOHANNESBURG (miningweekly.com) – Gold exploration and development company Middle Island on Thursday reported the outcomes of a pit optimisation study for the Wirraminna deposit, in Western Australia.

Undertaken by Mining Focus Consultants, the study results reveal that at a gold price of A$1 600/oz the optimal pit shell – based on the maximum undiscounted operating cash flow – includes 72 000 t at a grade of 1.97 g/t gold for a strip ratio of 9:1. This equates to a mill recovery of 4 200 oz of gold.

The pit shell depth is to a maximum of 45 m from the surface and hence is wholly contained within the oxide zone.

The results also indicate that increasing the overall pit slope to 45^o results in about a 30% increase in contained resource in terms of tons and a 60% increase in net operating cash flow.

Going forward, Middle Island foresees “considerable opportunity” to further extend and enhance the Wirraminna deposit through follow-up drilling, including infill and extension drilling of inferred mineral resources, and confirming the location of historic higher grade holes.

As such, the company is planning further reverse circulation drilling and will obtain additional data, prior to updating pit optimisations, considering pit design work and ore reserve estimation.

Parameters of the openpit optimisation results fell in line with a mineral resource model released in December. This model was based on a Joint Ore Reserves Committee 2012-compliant mineral resource estimate of 550 000 t at 1.3 g/t gold for 23 000 oz at a 0.5 g/t lower cutoff grade.

The Wirraminna deposit is situated 1 km west of the company’s 100%-owned Sandstone gold processing plant, which has a capacity to process 600 000 t/y.

Middle Island MD Rick Yeates said the positive drilling results, mineral resource estimation and pit optimisation work on the Wirraminna deposit served to further extend the production profile for the proposed Sandstone gold operation. “However, the quantum and grade of the deposit is presently insufficient to trigger a mill recommissioning decision in isolation.”

He added that drilling indicated substantial potential to extend the deposit, and the location of higher grade historic drill intercepts of 11 m at 23.8 g/t, 16 m at 14.6 g/t and 19 m at 4.85 g/t remained unresolved.