Horizon Minerals has kicked off mining activities at its recently-approved Boorara gold development operation sitting adjacent to Northern Star’s massive Super Pit mine in Kalgoorlie that has produced more than 60 million ounces of gold.
Management last month gave approval for the mining of four open pits at the Western Australian Goldfields site that contains 1.24 million tonnes of ore grading 1.24g/t gold for 49,500 ounces and says it has already kicked the plan into action.
The company’s recently-appointed contractor Hamptons Transport has established a mine-ready site to enable drill and blast activities, grade-control drilling and the start of load-and-haul production mining. Horizon says all activities to date have been conducted productively and safely.
Plans are for mining to occur for a 14-month period, with ore to be processed at Norton Gold Fields’ nearby Paddington plant. It is expected to generate $30 million in free cash flow for Horizon at a gold price of $3600 in local currency.
Management struck an impressive deal on the mining services and load-and-haul contracts, with no payments to Hamptons required until the first gold pour has been sold and funds are in the bank.
The company plans to ramp-up proceedings by expanding its single-shift digging operation to a two-digger day-night operation, resulting in four shifts per day by the end of next month and making a serious dent in the tonnage expected to be mined.
First ore from the operation is on track to be mined next month after the removal of the overburden, while haulage of the material to Paddington will see processing begin in October.
Horizon Minerals managing director and chief executive officer Grant Haywood said: “We are eagerly awaiting mining progressing to expose first ore in September and pouring gold bars in October to give us first revenue from Boorara in this strong gold price environment. This is a major milestone for Horizon as we commence our journey to be a long-term sustainable gold producer, delivering significant cashflows into the business to create further value through our significant portfolio of assets.”
The 100 per cent-owned Boorara gold project sits some 15km east of the gold mining town of Kalgoorlie-Boulder.
Management says the next steps will be to complete phase one of its grade-control drilling program and gradually begin to ratchet-up its load-and-haul production mining throughout the remainder of the next two months.
The company recently confirmed that a joint venture (JV) agreement had been finalised with Kalgoorlie-based contractor BML Ventures to mine 200,000 of ore from its Phillips Find gold project near Coolgardie following a recent merger with Greenstone Resources. The ore will be toll treated at the nearby Greenfields Mill during the next 11 months to produce almost 15,000 ounces of gold.
Management also revealed that higher silver and zinc prices have led to it dust off its mothballed Nimbus project that sits next to the flagship Boorara operation. The company has set a big exploration target to chase at Nimbus, with a drilling campaign planned for next year as it looks to ramp up its resources for an upcoming feasibility study.
Horizon has a two-pronged cash-generating strategy that makes sense in today’s environment of high gold prices, with Boorara appearing to be the jewel in the company’s crown.
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By Craig Nolan
