Regis plans $29m expansion

Regis Resources has approved a $29.4 million expansion at its Duketon gold project, which is expected to add 570,000 ounces over a five-year mine life.

The expansion comprises development of an underground mining operation below the current Rosemont open pit.

Regis said it would begin work on the expansion in the current quarter, with the mine expected to come online in the 2020 financial year.

“Development work will commence in the current quarter with permitting, the ordering of long lead capital items and underground mining contract tendering process,” the gold miner said.

“Commencement of portal development in the southern end of Rosemont main is expected in the March 2019 quarter with processing of the underground material expected to commence in the December 2019 quarter.”

Along with the $29.4 million initial capital cost, the company is estimating a further $9.7 million will be spent over the life of the mine.

Executive chairman Mark Clark said it was the first underground mine at Duketon.

“We believe that the approved Rosemont underground operation is a robust business in its own right but just as importantly will see the infrastructure in place to grow that mine through exploration from an established underground footprint,” he said.

“This growth opportunity will be targeted both laterally between the two mining zones and at depth and along strike.

“There is also a very strong opportunity to replicate this development path at Garden Well in the near term and then at other Duketon satellite pits in due course.”

The gold miner said the combined open pit and underground operation at Rosemont is expected to produce between 120,000-130,000oz/year, an uplift of 35,000-40,000oz/year from the average grade of the open pit.

Operating cost of the combined operation is expected to be about $1,015/oz, with the operating cost of the underground mine component estimated at $1,154/oz.

Regis’ production guidance for FY19 stands at 340,00-370,000oz.

Shares in Regis were off 2.19 per cent at $4.24 each at 3pm AEDT.