Future looks golden for King of the Hills

Northern Goldfields-focused Red 5 is hailing a “transitional year” for the company as it charges ahead with plans to develop a standalone plant at its King of the Hills goldmine near Leonora (reports The West Australian).
16th October 2020
Resources Rising Stars

Northern Goldfields-focused Red 5 is hailing a “transitional year” for the company as it charges ahead with plans to develop a standalone plant at its King of the Hills goldmine near Leonora (reports The West Australian).

Presenting on the final day of this year’s annual Diggers & Dealers Mining Forum in Kalgoorlie-Boulder, Red 5 boss Mark Williams yesterday revealed the miner had committed cash to long lead items.

That included a sag mill and a gyratory crusher expected to arrive at the project midway through next year.

Mr Williams said Red 5 would complete the project financing at the end of the year and appoint anengineering, procurement, and construction contractor within weeks.

The company is currently clearing ground and erecting central camp facilities at the project, and has tipped a final investment decision by early next year.

Red 5 last month unveiled a detailed plan for a standalone plant at the KOTH mine, pointing to an initial 16-year mine life, with first gold from the revamped mine expected in the 2022 June quarter.

That would see 450 employed during peak construction, with an ongoing 300 contractors and staff during production, up from 125 currently.

At an assumed $2500 per ounce gold price, the study points to a pre-tax net present value of $1.1 billion, with a 64 per cent internal rate of return. The study also anticipates a $226m capital cash splash would be paid back in 25 months, with average annual production of 176,000oz across the first six years.

Mr Williams yesterday said the project which boasts 2.4 million ounces would propel the mine into the top 10 of Australia’s largest endowed goldmines.

“Needless to say, at Red 5 we believe we have a stand-out growth opportunity and we have a management team to be able to deliver and seize against that opportunity,” he said.

“This year is a transitional year for us where we’re breaking the dependency of Darlot for the feed at King of the Hills, and that will set us up for 2022 with two mines and two processing plants.”

 

Image: Red 5 Limited 

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