Red 5 uncovers more within King of the Hills

While resuming production is still many months away, Red 5 has eyes for an even bigger prize at its King of the Hills gold mine, Western Australia, with a 19% boost in underground resources (reports MiningNews).
23rd July 2021
Resources Rising Stars

The miner has delivered a 130,000 ounce increase in contained ounces for the underground component of its mine, following the completion of some 33,000m of drilling completed last year.

Discovery costs were estimated at A$34/oz.

Open pit resources were reduced by 2%, or 80,000oz, due to depletion during mining operations, which were suspended in January, and some adjustments due to the miner's improved understanding of geology.

Overall, combined resources at the mine have increased from 4.07Moz to 4.12Moz grading 1.4 grams per tonne, split between 830,000oz at 2.1gpt for the underground and 3.3Moz at 1.3gpt for open pit areas.

Three quarters of the resources are indicated.

Red 5 managing director Mark Williams said the result confirmed the company's belief that it will be possible to extend the current underground mine life beyond 4.5 years, particularly as the mine deepens.

Underground drilling is scheduled to recommence at King of the Hills in August 2021, initially focused on grade control before moving to resource definition.

Some 140,000m of underground drilling is planned over the next 24 months.

Williams said all the work to date had confirmed the robustness of the company's modelling.

KOTH is expected to resume operations by mid-2022, once a new 4Mtpa mill is completed.

The mill may also be the destination for ore from its aging Darlot operation to the north, an option that is being considered as part of a wider strategic review into the best way to optimise the company once it has two operational hubs in the Leonora region.

The Darlot operation continues to generate Red 5's sole sources of income, from both remnant ore in the underground mine and the new Great Western open pit.

Production from Darlot for the previous quarter was 15,251oz at all-in sustaining costs of $2461/oz

Red 5 is confident KOTH will start on time.

The company ended the quarter with $50 million in cash and bullion.

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