Alacer Gold says it will spend $25 million on the construction of a new mill, the recommencement of open pit operations at three pits, and ongoing feasibility studies as part of the first stage of expansion at its South Kalgoorlie Operation.
The gold miner said the $25 million budget approval would fund ongoing feasibility studies for the Mt Marion underground mine, Shirl underground and open pit mines and HBJ underground mine; ordering long-lead items for a new 2.5 million tonne per annum treatment plant; and the recommencement of mining at the Mt Martin, Triumph and Pernatty open pits at South Kalgoorlie.
The funds will also be applied to the start of cutback mining at the HBJ open pit.
Alacer said it expected the new treatment plant, which will replace the existing 25-year-old, 1.2Mtpa Jubilee mill, would be commissioned by early 2013.
Alacer also said that exploration work had taken the mineral reserve at South Kalgoorlie to 13.1 million tonnes containing 1.8g/t gold for 761,000 ounces, a 96 per cent increase on the previously reported reserve of 389,000oz.
“We are systematically and prudently progressing South Kalgoorlie towards reaching its targeted gold production of 200,000 ounces per annum – an important part of our goal of becoming an 800,000 ounce gold producer by 2015,” Alacer chief executive Edward Dowling said.
“South Kalgoorlie is located in a prolific and extremely well endowed, but under explored gold district that we believe will yield further significant gold discoveries.
“We are working towards building a larger treatment facility that will provide a cost-effective basis for processing known resources and new discoveries in a manner that creates substantial shareholder value over time.”
At 11:46AM (WST) Alacer's stock was up 2.8 per cent, at $10.35.
