Classic Minerals to commence trial mining at Kat Gap gold project
Classic Minerals will excavate up to 5,000t of ore grading 4-6g/t gold for up to 1,000oz.
Western Australia’s industry regulator has approved the mining of a bulk ore sample from a trial pit at Classic Minerals’ (ASX: CLZ) wholly-owned Kat Gap gold project near Southern Cross.
The Department of Mines, Industry Regulation and Safety gave the go-ahead today and bulk sampling is expected to commence shortly to assist Classic with determining mining and metallurgical parameters prior to full-scale production.
The exercise will expose approximately 5,000t of ore, grading between 4 grams per tonne and 6g/t gold for up to 1,000 contained ounces.
This ore will be fed into the project’s 30t per hour capacity Gekko plant for testing and finetuning of the processing circuit in time for first production in August.
Classic’s geological and engineering teams will measure structural data firsthand from the walls and floor of the trial pit to enable selection of the best geotechnical parameters to maximise safety and minimise strip ratios.
The company said direct structural measurements of exposed gold mineralisation could potentially shed light on the presence and attitude of additional lodes which could be targeted for increases to resource inventory.
Grade distribution will also be studied to determine how varying grade models stand up to results of the trial, allowing for optimisation of modelling and drilling activities.
Project funding
The final stages of Kat Gap’s development are being funded by a $1.78 million loan from innovative specialist funder Radium Capital.
Classic received the loan over two instalments in March and May.
The money is due to be repaid from Classic’s share of the Australian government’s research and development tax incentive rebate, plus 14% per annum interest.
Fraser Range earn-in
Earlier this week, IGO Limited (ASX: IGO) subsidiary IGO Newsearch Pty Ltd confirmed it would exercise its right to acquire 51% of Classic’s Fraser Range tenements, 160km east-southeast of Kambalda, as part of an earn-in and joint venture agreement signed in mid-2019.
IGO earned the equity by spending $1.5 million on exploration of the highly-prospective tenements, located in the world-class Fraser Range province, while Classic focused its efforts on the-then emerging Kat Gap project.
IGO has committed to spending a further $1 million on exploration over the next two years at Fraser Range to boost its joint venture interest to a total 70%.
Under the terms of the agreement, IGO will pay Classic $500,000 on transfer of the 51% interest.