In what it describes as an “outstanding” pre-feasibility study (PFS), Bardoc Gold (ASX: BDC) said its namesake project near Kalgoorlie now has the potential to become a substantial mid-tier producer.
The PFS forecasts an initial eight-year mine life with average annual production of 135,000 ounces at an all-in sustaining cost (AISC) of A$1,220/oz, which the company says will make it the next significant producer in the Kalgoorlie region.
It signals a rebirth for the historic Bardoc goldfield which was largely abandoned in 1908 as other big gold deposits were found in the Kalgoorlie region.
Using a A$2,100/oz gold price, the study estimates life-of-mine pre-tax cash flow of $551 million, based on total mined output over the eight years of 1.02 million ounces and recovered gold totalling 951,000oz.
The maiden open pit and underground probable ore reserve totals 10.4 million tonnes at 2.4 grams per tonne gold.
Bardoc will build an on-site carbon-in-leach (CIL) plant capable of processing 1.8Mt of ore per annum. The mill will include a floatation circuit to generate concentrate for sale to international markets.
The PFS covers only four main deposits (Aphrodite, Zoroastrian, Excelsior and Bulletin). Further regional exploration and numerous existing satellite deposits offer “significant upside”, according to the company.
Bardoc chief executive officer Robert Ryan noted the assumed base case gold price of A$2,100/oz was well below current spot prices of A$2,530/oz and the project would deliver robust margins and strong cash flows.
“In addition, with a significant exploration program planned over the coming months and a strong balance sheet, were are confident of growing the global resource, building on the recent drilling successes at the Mayday North, El Dorado and North Kanowna Star deposits,” Mr Ryan said.
Last week, veteran gold analyst Keith Goode said Bardoc had a significant ground holding having acquired 40 additional tenements in 2019, thus filling in the gaps of its ownership in the Bardoc goldfield.
“And there’s still Slug Hill to evaluate,” added Mr Goode. “That tenement hosts the historic Slug Hill gold mine which was mined between 1897 and 1908 and produced 20,008oz at an average grade of 23.5g/t.”
“Records show that this mine was the highest producing operation in the old Bardoc mining centre,” he said.