Barton Gold (ASX: BGD) (OTCQB: BGDFF) has started a 900-metre water bore drilling campaign at its Tunkillia gold project in South Australia.
The company has engaged local contractor Underdale Drillers to complete the work, with the aim of locating additional sources of nearby water and potentially de-risking and improving project economics.
Barton has also confirmed that Phase 2 mineral resource upgrade drilling campaign at Tunkillia will commence as planned in March.
Approximately 28,000m of reverse circulation work will target the conversion of open pit mineralisation beyond the two starter pits to the Indicated category.
Phase 1 Results
The Phase 2 campaign will follow-up ++Phase 1 upgrade drilling++ that returned best results of 23m at 2.25 grams per tonne gold from 62m including 2m at 5.45g/t from 69m, 1m at 7.5g/t from 75m and 1m at 8.9g/t from 81m, 22m at 2.43g/t gold from 100m including 1m at 17.6g/t from 107m, and 28m at 2.6g/t gold from 129m including 2m at 20.9g/t from 144m.
Barton will run a 3,000m diamond drilling program in parallel to target the infill and expansion of Tunkillia’s geotechnical and metallurgical database.
The work will support further open pit design optimisation, detailed recovery and production modelling as well pre-feasibility study and mining licence applications before year end.
Optimised Scoping Study
An ++optimised scoping study++ in May outlined a compelling development scenario for the Tunkillia project, based on a proposed annual production of 120,000 ounces gold and 250,000oz silver.
In the first 27 months, the S1 and S2 starter pits have been modelled to produce 365,000oz gold and 923,000oz silver and $1.3b operating free cash at an average cash cost of $1429/oz.
Total life-of-mine operating cash is predicted to sit around $2.7 billion (pre-tax) against a net present value of $1.4b (pre-tax) and a 73.2% internal rate of return.
Barton managing director Alexander Scanlon said the company would expedite Tunkillia’s project finance discussions in parallel with a targeted reinstatement of Stage 1 gold operations at the neighbouring Challenger project.
“Our objective is to bring Tunkillia online as soon as possible to realise our gold production target of 150,000oz annually,” Mr Scanlon added.
