Barton Gold confirms material project efficiencies at Tunkillia with optimised scoping study
An optimised scoping study for Barton Gold’s (ASX: BGD) (OTCQB: BGDFF) large-scale Tunkillia project in South Australia has shown that material efficiencies and record commodity prices could drive an estimated total payback for the development within 13 months of start-up.
The optimisation builds on the initial scoping study released in July 2024 that outlined an eight-year project life (inclusive of construction), processing 30.7 million tonnes of material to produce 833,000 ounces of gold and 1.9 million ounces of silver against a 22-month payback.
Material efficiencies have extended the project’s total life (including construction) to approximately 10 years and accelerated higher-value mill feed over an eight-year life-of-mine.
Lowered costs
The efficiencies include a $35 million reduction in capital expenditure from $434m to $399m and as much as 35% lower comminution power costs for oxide and fresh materials, supporting an average annual production of 120,000oz gold and 250,000oz silver from 942,000oz recovered gold and 2Moz recovered silver.
Within an open pit optimised to $3,500/oz of gold and based on revenues of between $4,000 and $5,000/oz, Tunkillia’s life-of-mine estimates include an average all-in sustaining cost of up to $2,222/oz gold, average operating cash flow of up to $2,829/oz gold and total revenues of between $3.9 billion and $4.8b.
Total pre-tax operating cash flow of as high as $2.7b and a pre-tax net present value of between $781m and $1.4b underpin a 73.2% internal rate of return and an estimated payback period of just 13 months.
The company expects a higher-grade Stage 1 ‘starter pit’ to produce approximately 206,000oz gold and 491,000oz silver during the same period at an operating cost of $997/oz gold (net of silver credits), generating $825m free cash or $4,003/oz gold at current market prices.
Material gains
Barton managing director Alex Scanlon said Tunkillia’s optimised scoping study had delivered the expected material gains for the company.
“The energy savings from three-stage crushing and lower work indices, combined with higher oxide recoveries and gold prices, demonstrate the financial and capital leverage available to large-scale processing of bulk open pit materials,” he said.
“The higher-grade ‘starter pit’ alone could pay back more than twice our upfront capital costs within the first 13 months [and] we are well-positioned to achieve this with a $12m record of asset monetisation initiatives, a low net cash burn rate and $7m cash on hand.”
Growth potential
Barton acquired the Tunkillia project in December 2019, believing it had significant growth potential due to limited historical exploration during periods of markedly lower gold prices.
The company completed multiple rounds of reverse circulation and diamond drilling, identified several resource extensions and delivered five mineral resource estimate updates between October 2020 and March 2025.
Following the most recent resource upgrade to 1.6Moz gold for 62.9Mt at 0.8g/t gold and the completion of third-party technical studies and metallurgical analyses, Barton commissioned GR Engineering Services and Mining Associates to lead the optimised scoping study.