PERTH (miningweekly.com) – A prefeasibility study (PFS) into New Zealand gold developer New Talisman Gold Mine’s Talisman project has shown that the project could deliver robust economics.

The study found that a first-stage development of an underground mine could deliver a cash surplus of NZ$23.4-million during its five-year mine life, and estimated a capital cost of NZ$1 075/oz.

A start-up capital of NZ$5.4-million would be required to start operations at Talisman, and production was expected to peak at some 12 115 oz/y of gold and 36 000 oz/y of silver.

“This finding is a very positive step for the company’s plan to reopen the Talisman mine in the world-class Waihi gold district,” said New Talisman’s executive director, Matt Hill.

“The pace of work has stepped up so that the project can get under way once detailed mine planning and permitting have been concluded. The development initially of a small, low-impact, high-grade gold mine sets the platform for the exploitation of target areas for future Phase 2 developments.”

Hill noted that previous underground drilling and sampling had delineated a mineral resource of 204 760 oz of gold and 798 840 oz of silver. The mining operation examined in the PFS would involve only part of this resource, aimed at generating an income to fund the extension of the development.

Initial mining would produce a cash surplus of some NZ$23.4-million from 106 500 t of ore milled, with a total of 32 200 oz of gold and 102 800 oz of silver recovered.

New Talisman would now look to initiate a bulk sampling programme, which would enable further metallurgical testwork, and delineation of the initial target ore zones. The company would also start a feasibility study on the Woodstock and Dubbo zones, which were the initial mining taregts.

The ASX-listed junior would also look to possible toll treatment agreements, and would compile an environmental-impact study to accompany applications for resource consent, as required under New Zealand law.