New JORC studies have helped Red 5 Limited (ASX: RED) record significant increases in the Ore Reserve and Mineral Resource estimates for the Darlot Gold Mine in Western Australia.
The updated Proven and Probable Ore Reserve for the Darlot Gold Mine has is now estimated at 2.6Mt @ 3.3g/t Au for 275,000 ounces of contained gold – up 26% since 30 June 2019, net of mining depletion of 37,738 ounces to 31 December 2019.
Managing Director, Mark Williams said this increase in the Reserve base is due to the completion of mining studies that have confirmed suitable mining methods to extract gold mineralisation within the Centenary orebody along with areas that had previously been classified as sterilised and/or not economical.
Meanwhile the Ore Reserve, based on an updated Measured, Indicated and Inferred Mineral Resource for the Darlot Gold Mine of 10.8Mt @ 3.5g/t gold for 1,203,900 ounces of contained gold, has returned a 16% increase in contained ounces since the previous Resource estimate reported as at 30 June 2019 – net of mining depletion.
Mr Williams said the Total Resource figure includes an updated underground Mineral Resource of 8.1Mt @ 4.3g/t Au for 1,122,000 ounces of contained gold (at a 2g/t Au cut-off grade –and a maiden open pit Mineral Resource of 2.7Mt @ 0.9g/t Au for 81,600 ounces of contained gold.
Darlot is an exceptional gold system and our ongoing Resource and Reserve development programs are delivering growth across multiple fronts,” Mr Williams said.
“This announcement is part of a number of workstreams currently underway to progress Red 5’s Darlot Hub Mining Strategy, which is aimed at establishing a five to ten year mine life at Darlot, as a stand-alone mining operation, complementing the proposed development of King of the Hills and establishing two growth pillars of a leading mid-tier Australian gold producer.”
“When Red 5 purchased the Darlot Gold Mine in 2017, the acquisition included a significant high-grade non- JORC mineral endowment that required review, confirmation and design by our Geology and Mining Engineering team before it could be included within our Resource and Reserve estimates.
“This includes areas deemed by the previous owner to have been sterilised, together with additional areas – including several oxide open pit deposits – that were modelled but never upgraded to JORC compliance.”
Mr Williams said Red 5 has been working to convert these areas to Resource and Reserve status, with the work completed to date, together with extensional drilling at Lords Felsics, increasing the Reserve base by 26% to 275kozs and our Resource base by 16% to 1.2Moz since the previous estimates reported as at 30 June 2019, net of the ounces produced up to 31 December 2019.
“Importantly, we also see opportunities for further growth. We have recently increased our budget for Darlot expansion programs in FY20, committing an additional $2.3 million for Resource drilling as well as $2 million to accelerate underground mine development to access new mining areas and open up new underground exploration platforms.
“This brings our total geology budget for Darlot to $10.1 million for current financial year.
“Work programmes include 12,500m of underground drilling and 6,000m of surface drilling at the Darlot mine, as well as an 11,000m regional drilling program, with processing studies also underway with the goal of extending our Reserve base within trucking distance of the Darlot mill.
“With the Final Feasibility Study well advanced for the establishment of a stand-alone mining and processing operation at King of the Hills, this would potentially provide Red 5 with two high- quality, long-life mining hubs in the world-class Eastern Goldfields region of Western Australia.”