ASX-listed gold miner Classic Minerals has moved closer to full-scale production at its flagship Kat Gap project near Southern Cross in Western Australia after hitting a substantial body of water in its first exploratory hole.
The company considers the discovery an important milestone given that water is an essential ingredient in treating the precious metal at the operation’s gold processing facility.
According to Classic, the water bore targeted a significant fault zone defined through previously acquired aeromagnetic data. The regional fault zone is expected to carry a considerable quantity of ground water. Management says that after formal approval, it will sink several more holes across the structure to vector in on the area’s potentially large aquifer that could contain enough water to feed the project for a long time.
The water bore is strategically positioned with the area’s main haul road, a little more than 1km from Classic’s processing hub where the Perth-based miner has already set up a pair of process water tanks and a gold processing shed.
The jewel in Classic’s processing centre is its Gekko processing plant – a mobile unit capable of treating up to 250 tonnes of ore per hour.
The treatment facility is about 7km from Classic’s mining field.
The company says the short distance will make pumping the water to its plant a “relatively simple” process without the need for the construction of expensive and timely infrastructure.
Classic is now waiting on regulatory approvals to launch a follow-up probe and has already begun assessing the maiden hole’s water quality.
Water is seen as an essential component in the production of gold and surface mine operations such as Kat Gap can use up to 100,000 cubic metres of it each day.
The company has a solid line of gold to process, holding a total mineral resource of more than 8 million tonnes at 1.52 grams per tonne gold for almost 404,000 ounces of contained gold.
Much of the gold is derived from Kat Gap, with the operation responsible for close to 93,000 ounces of contained gold grading a solid 2.96 grams per tonne gold.
The Kat Gap project, about 170km south of Southern Cross in WA, has been in the news lately after Classic began stockpiling ore for its gold processing facility.
Classic is currently sitting on an ore stockpile of about 6500 tonnes going 4.82g/t gold.
A few weeks ago, the company had a trial mining operation approved by the state regulator to excavate up to 49,000 tonnes of material from Kat Gap.
The trial also allows Classic to assess an open-pit mine design at the project, a critical factor in determining the economics of the operation.
With Classic chasing water to feed its gold processing plant at Kat Gap, the early signs look promising, particularly if a second hole can tap into an aquifer.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
