Name of the Project
Mount Morgan gold/copper project.

Location
The project is part of the historical Mount Morgan mine located in central Queensland, Australia.

Client
Carbine Resources.

Project Description
Mount Morgan has total indicated and inferred resources of 37.2-million tonnes grading 0.71g/t gold for 850 000 oz, comprising 394 000 oz in the indicated category and 456 000 oz in the inferred category. 

A feasibility study completed on the project has delivered a strong base case for the development of a long-life operation.

Based on a 1.1-million-tonne throughput rate, the project is expected to have a mine life of nine-and-a-half years producing 30 000 oz/y of gold and 3 800 t/ of copper sulphate.

The estimated 9.9-million-tonne ore reserve grading at 1.19 g/t gold is associated with just four of the historical tailings dumps at Mount Morgan – Mundic Gully, Red Oxide, No 2 Mill and Shepherds – delivering gold, copper sulphate and premium unroasted iron pyrite concentrate to market.

Each of the four tailings dumps will be mined using conventional openpit mining methods. The ore (tailings) is free digging and the mine plan has taken into account the various waste walls and overburden required to be mined in conjunction with the tailings to ensure that they can be successfully mined and transported to the processing plant.

The project’s life could be extended to about 20 years, as a substantial inferred mineral resource exists within the remnant tailings in the Sandstone Gull and Mount Morgan openpit.

The expanded case will result in the production of about 18 000 oz of gold and 2 000 t of copper sulphate during years 10 and 20 of the mine life.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a payback of two years.

Value
The preproduction capital cost for the base case and the expanded case will remain consistent at A$85.1-million; however, the overall capital required for the base case over the life-of-mine is estimated at A$94.4-million, and at A$116.1 for the expanded case.

Duration
Not stated.

Latest Developments
Carbine Resources has terminated its Mount Morgan gold project, after failing to reach agreements with project stakeholders.

Carbine warned shareholders in February about the future of Mount Morgan, after an economic review determined that the project would not generate adequate returns to justify development.

The project was expected to have an all-in sustaining cost of about A$862/oz, compared with the estimated A$549/oz in a 2016 feasibility study and, along with an A$85.1-million preproduction capital expenditure, the gold operation would not generate adequate shareholder return.

Carbine has been unable to achieve any meaningful outcomes with the project stakeholders to improve the terms of the various agreements associated with the project, which would increase returns to an acceptable level.

In addition to immediately suspending all project expenditure, and stopping all work associated with the Mount Morgan project, Carbine has also decided not to exercise its option to acquire the remaining 25% stake in the project from Raging Bull Mining.

Meanwhile, MD Tony James has given notice of his resignation, while John Fitzgerald and Graham Brock have resigned as directors, effective immediately.

Company secretary Oonagh Malone will join the board, effective immediately, while Evan Cranston has been appointed as nonexecutive chairperson.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Carbine Resources, tel +61 8 6142 0986, fax +61 8 9388 8824 or email admin@carbineresources.com.au.