DeGrussa could live on as gold operation

Sandfire Resources has reported a maiden resource for its Old Highway gold deposit, which could extend the life of its depleting DeGrussa copper-gold operation (reports MiningNews).
16th December 2021

Old Highway has an initial indicated resource of 2.8 million tonnes at 2.5 grams per tonne gold for 223,000 ounces of gold, including an 102,000oz at 9.5gpt in underground resource.

It is just 20km from DeGrussa, which is expected to run out of copper ore next year.

While modest, Old Highway could extend the life of the operation.

"With the scheduled completion of copper-gold production from DeGrussa in the September quarter of next year, this maiden mineral resource for the Old Highway deposit provides a solid start for a potential future gold operation leveraging the existing processing infrastructure on site," Sandfire managing director Karl Simich said.

"Given that the infrastructure is already there, even a relatively small-scale gold resource has the potential to deliver solid financial returns."

Sandfire has already completed preliminary design and costing work for the addition of a gold recovery circuit at DeGrussa, as well as haulage costs, design work, metallurgical testwork and environmental work.

Study work is expected to be completed in the March quarter.

Drilling is continuing at Old Highway with a 9100m, 24-hole diamond drill program underway, focused on extending the high-grade mineralisation in the Central Deeps section of the deposit and depth extensions up to 200m below known mineralisation.

The majority of the eight holes completed to date have intersected quartz veins in the expected position down-dip from the known mineralisation.

DeGrussa has produced over 600,000 tonnes of copper and 350,000 ounces of gold over its life, realising A$5 billion in revenue.

The operation is expected to produce 64,000-68,000t of copper and 30,000-34,000oz of gold in its final year.

In the meantime, Sandfire will also step up its production, with the US$1.86 billion acquisition of the MATSA complex in Spain due to complete in the March quarter.

From 2023, the company will also be in production in Botswana from the new Motheo mine.

"Sandfire already has an exceptionally strong asset pipeline, with our acquisition of the world-class MATSA mining complex in Spain nearing completion and the development of our new Motheo copper-silver mine in Botswana well underway," Simich said.

"We will continue to progress feasibility studies for Old Highway in parallel with delivering these other global growth initiatives."

Subscribe to the RRS Weekly Wrap

© 2022 Resources Rising Stars All Rights Reserved