02/03/2016 - 14:56

Gascoyne's project to cost $75m

02/03/2016 - 14:56

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A component of a pre-feasibility study on Gascoyne Resources’ Dalgaranga gold project has confirmed a $75 million cost to bring it into production.

A component of a pre-feasibility study on Gascoyne Resources’ Dalgaranga gold project has confirmed a $75 million cost to bring it into production.

Gascoyne said in a statement today that the preferred process plant design component of a PFS had been completed by engineering group Mintrex, and had estimated $60.5 million in process plant costs and $14.5 million in associated infrastructure costs.

The study has confirmed the project to be a substantially lower cost development than a typical project of its type and size, Gascoyne said, due to a number of characteristics.

This includes the soft nature of the ore within the project, which would result in a lower power requirement.

“Along with the soft ore, the gold is very easily liberated, resulting in a relatively coarse grind and rapid leaching,” the company said.

“The existing tailings storage facility can also be utilised, which reduces the pre-production capital as only a TSF lift is needed and not a whole new facility.”

Gascoyne managing director Michael Dunbar said the PFS, which was on track to be completed by the end of the month, was expected to result in a development case for about 100,000 ounces of gold per annum for around six years.

“Confirmation that the Dalgaranga project can be progressed with a relatively low capital cost is very welcome news,” he said.

“The deposits at Dalgaranga have a number of unique characteristics that Gascoyne and Mintrex have identified, which will result in lower than normal capital and operating costs, including the very soft nature of the ore, the excellent metallurgical recoveries, rapid leaching and very low reagent consumptions.

“When combined, these make a very substantial impact on the costs for development.”

Gascoyne shares were 8.1 per cent lower to 28 cents each at the close of trade.

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