Mutiny on the Cassilis

A new Western Australian gold company has consolidated 70 old gold mines in the Victorian Alps with the aim of resuming production and building it to 100,000 ounces a year.

Mutiny Gold Ltd has already spent more than two million dollars on the project, centered around the small Victorian town of Swift Creek in the Omeo region, 400 kilometres east of Melbourne.

The company is seeking to raise five million dollars via the issue of 25 million shares, initially to bring back the historic Cassilis underground mine.

Cassilis contains a number of quartz reefs, which have consistently returned high grade gold and are accessible via two existing adits.

Mutiny plans to begin a drilling program soon after the expected ASX listing in early June this year.

The program and resource estimation will be followed by a mine feasibility study, with a view to mining at Cassilis and building production to 100,000 ounces a year over three years from Cassilis and other resources within the project area. These include the King Cassilis and Warden workings, both of which produced high-grade ore during earlier operations.

The Mutiny prospectus has targeted an average ore feed grade of between a high 16.5 and 20 grams of gold a tonne.

Cassilis previously produced more than 70,000 ounces from just 73,300 tonnes of ore. Mutiny is headed by chairman and chemical engineer Frank Lawson and managing director John Greeve, the senior partner at accounting firm Jackson Greeve.

Mr Greeve also acts as Australian agent for US investment fund Cornell Capital Ltd and has spearheaded their investment in several mining companies including Fortescue Metals Group Ltd and Queensland Gas Corp Ltd .

Other directors include metallurgist Allan Brown, previously mine manager at the Golden Grove operation and Wiluna Gold Mine; foundation shareholder Donald Hardman; and funds manager Benedict Kusni.

The issue opens on April 14 and closes June 2 this year.