Copyright thewest
Kaiser Reef has boosted its ore reserves at the Henty gold mine in Tasmania by a robust 29 per cent to 199,000 ounces at 3.28 grams per tonne (g/t), locking in an expanded mine life well beyond six years. The reserves boost was tabled alongside a mineral resource upgrade of 4.11 million tonnes at 3.32 grams per tonne (g/t) for 438,000 ounces of high-grade underground gold. Kaiser seized control of the underground operation near Queenstown in May of this year and has hit the ground running, pumping out more than 8000 ounces in its first full quarter. The reserve jump from the prior 154,000 ounces signals Henty’s growing role as the company’s cornerstone asset, as it continues to explore for gold extensions and look into the restart potential at its large historic Maldon gold mine in the Victorian Goldfields. Depletion from mining to mid-year at Henty hit 25,700 ounces but fresh conversions from the resource base drove the net gain, securing a production runway targeting over 30,000 ounces per annum, with even 35,000 ounces looking firmly in sight now. The boost dovetailed with recent plant processing upgrades that should see an annual run rate of 400,000 tonnes of ore, up by a third. The higher throughput clears a key bottleneck, allowing Kaiser to haul more ore from underground to the mill. Coupled with the expanded reserve, this sets Henty up to churn out roughly $220 million worth of gold at the current spot prices. The company says it has now rolled out a second underground diamond drill rig to chase resource extensions while pushing ahead with decline de-bottlenecking, a fleet of larger haul trucks and twin-boom jumbo drills to cut costs and boost output. The second underground diamond drill rig gives a completely dedicated capacity to extend resources while the first rig can primarily focus on reserve conversion. Kaiser Reef Managing Director Brad Valiukas said: “We have committed to increasing the processing rate, which removes a significant constraint on underground production potential, de-bottlenecking the decline so we can deliver to the processing plant and bringing in more productive equipment as key improvements to drive performance. We expect to see continued improvements across the business during the financial year.” The reserve increase and plant upgrades position Henty to capitalise on a recent red-hot gold market with prices pushing above US$4000 (A$6300) per ounce in recent weeks. The operation has already delivered over $10 million in free cash flow to Kaiser in the first quarter, boosting its cash pile to more than $28 million by July’s end. The processing plant’s new 400,000 tonne capacity outstrips its 20-year historical benchmark, allowing Kaiser to push ore throughput to match the expanded reserve base. Kaiser has a broader ambition to become a 50,000 ounce per annum producer in the short-term across Tasmania and Victoria. That ambition pulls focus to Maldon in Victoria where Kaiser holds a permitted underground project with historic mines and a working 200,000 tonne per annum processing plant. Drilling under its historic Union Hill pit wrapped in September with assays due shortly that will aim to define fresh new resources towards a kickstarted development. Maldon’s processing facility ties into a 50/50 joint venture with Catalyst Metals. Strategically placed between the gold-rich Bendigo and Ballarat regions, the Maldon plant opens the doors for Kaiser to feed Maldon ore into the plant while Catalyst could channel material from its Four Eagles project packing 70,000 ounces at a staggering 26 grams per tonne in the Boyd’s Dam deposit. With Henty’s reserves and throughput firing, Kaiser has a firm platform and funding source now to test Maldon’s vast potential which may end being the big game for Kaiser. Is your ASX-listed company doing something interesting? Contact: matt.birney@wanews.com.au
