Javelin Minerals has tweaked its mining plan to boost the expected gold recovery at the company’s Eureka project to 39,000 ounces, a 15 per cent increase from the previously announced 34,000 recoverable ounces. It follows on from a 27 per cent jump in the resource’s higher confidence indicated category.
The lift to indicated resources was accompanied by a 32 per cent bump-up in grade to 1.98 grams per tonne (g/t) gold, providing a significant uplift in anticipated cash flow from mining the project, expected to begin next year.
The huge jump in the gold grade for the 39,000 recoverable ounces extended to the project’s overall mineral resource, increasing it to 2.04 million tonnes at 1.69g/t, using a 16 per cent grade increase from the previous resource, for 110,687 ounces of the precious yellow metal.
Notably, the indicated mineral resource has been beefed-up and now stands at a solid 1.36Mt going 1.8g/t for 78,678 ounces, a significant 27 per cent leap. The bulk of the resource of more than 70 per cent is now positioned in the much-vaunted category. Much of the indicated resource sits below the southern end of the Eureka pit, where the company plans to begin its contract mining operations.
Javelin is engaging with several contract miners and nearby process plant operators, aiming to fast-track production and generate cash flow as quickly as possible.
With the gold price hovering at a gangbuster US$3352 (A$5180) per ounce, the higher grades in recoverable ounces and indicated resources could supercharge the project’s economics, providing both higher margins and cash flow. It provides the company with the option to consider boosting production ounces at the current sky-high price.
Management says the considerable jump in grade has enabled it to revise the tonnes to be mined, with a new pit optimisation study revealing a 20 per cent decrease in mined material to 698,887 tonnes.
Javelin Minerals executive chairman Brett Mitchell said: “With the very strong Australian dollar gold price, the good condition of the open pit and the ability to process the material at one of the nearby mills, our mining plan is looking extremely attractive, particularly against the backdrop of the company’s current market capitalisation.”
The Eureka project sits on four granted mining leases, 50 kilometres north of the nation’s best gold address at Kalgoorlie and 20km north of the large-scale Paddington gold operation, owned by growing gold giant Zijin Mining. Paddington is just one of several nearby operating mills.
Management points out the existing pit is in good nick and well-placed for mining operations to resume. Eureka is almost within shouting distance of several multi-million-ounce deposits, such as the Paddington and ASX-listed goldie Ora Banda’s Davyhurst mines.
The Eureka mineralisation occurs as a series of lens-shaped ore shoots up to 10 metres wide within a shear zone. Gold is hosted in quartz veins and stringers within altered mafic host rocks. The quartz veining contains quartz, carbonate and low amounts of sulphides with visible gold in parts.
Previous mining at the site worked a 120m deep, 300m long open pit developed by working some lens-shaped shoots extending up to 10m in width within a 30m wide shear zone.
Eureka was previously mined by two firms. West Coast Holdings scratched out 32,000 gold ounces from 220,000t at 4.5g/t and Tyranna Resources unearthed more than 5000 ounces from 50,600t grading 3.16g/t gold.
Javelin plans to undertake a further drilling program to expand its existing resource and will target potential down-dip extensions.
The company’s recent drilling program confirmed thick, near-surface oxide mineralisation 100m south of the pit, as well as a high-grade northern shoot. Both features lie outside the new resource upgrade.
Past drilling intercepts at the project include several head-turning hits such as 4m at 134 g/t and 3m at 48.75g/t.
The southern pit’s oxide and transition zones, hosting 15,774 and 17,812 ounces respectively, appear key to Javelin’s near-term contract mining plans. The shallow high-grade zones would minimise the company’s capital outlay while potentially maximising returns from a free-dig open-pit mining scenario.
In a further boost to its gold plans, the company recently revealed a suite of prospective, undercover gold and copper targets at its Coogee West project in WA’s Eastern Goldfields.
A geophysical review, run by Core Geophysics, highlighted several compelling high-priority anomalies beneath shallow alluvial cover.
Historical, wide-spaced air core drilling in parts of the Coogee West barely scratched the surface, only reaching depths of up to 30m. The new campaign will be designed to spin the drill bit deeper and unmask possible mineralisation lurking beneath.
Javelin says two of the five targets stretch 2-3km in strike length and have never been touched by a drill bit. The company plans to run high-impact drilling in the September quarter.
Javelin appears close to monetising what is shaping up to be a valuable gold asset and making the most of today’s heady gold price environment.
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By Craig Nolan
