28/07/2016 - 15:11

Blackham flags growth plan

28/07/2016 - 15:11

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Blackham Resources managing director Bryan Dixon has flagged plans to boost production at the miner’s Wiluna gold plant, as its shares lifted 10 per cent today.

Blackham flags growth plan
Underground mining at the Matilda gold project.

Blackham Resources managing director Bryan Dixon has flagged plans to boost production at the miner’s Wiluna gold plant, as its shares lifted 10 per cent today.

Speaking at a WA Mining Club lunch, Mr Dixon said he expected the first gold pour at Wiluna, which is currently a non-producing asset, would be at about the same time as the end of the Olympics in Rio de Janeiro next month.

But planning is under way to increase the plant’s capacity from its current capability of 100,000 ounces.

Mr Dixon said with the company now holding about 5 million ounces of reserves across four fields in the area, there was an opportunity to look at growing annual production.

“The Matilda project we’ve been working on for the last four and a half years,” Mr Dixon told the lunch.

“It includes Matilda, Wiluna, Lake Way and Quartz Reefs.

“In the past, previous operators have focused on the Wiluna mine.

“When we start up, we’ll be mining at Matilda and also Quartz Reef.

“Stage two of the project is looking at the Wiluna opportunity, there’s 3.5 million ounces of gold there, and it’s at a fantastic grade.

“With 5 million ounces in reserves, it doesn't make sense that we keep producing 100,000 ounces per year, and there’s an opportunity there to produce at a much higher rate.”

One number he cited was 130,000oz per annum, although industry sources suggest it could be around 200,000oz/year, given the size of the resource base.

Output from the Wiluna field would be at about $1,140/oz, Mr Dixon said.

Blackham bought the Wiluna project about four years ago for a cheap price when the previous owner was in receivership.

Now it looks like Blackham will be the next company to enter into gold production in Australia, at a time when the Australian dollar price is near record highs.

The key win had been forming a good mine plan and having the right grade profiles.

“(There’s) a lot of benefit to be made hanging onto these projects,” Mr Dixon said.

“The hard part is convincing investors, it’s very hard to find investors looking for value.”

Blackham shares last changed hands at 90.2 cents each today, a rise of 10 per cent.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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