De Grey Mining’s Hemi gold project surpasses 10 million ounces with resource estimate upgrade

The rating of De Grey Mining’s (ASX: DEG) Hemi project as one of the biggest undeveloped gold projects in the world continues to grow with the Western Australian discovery now estimated to contain more than 10 million ounces.

With the input of new data from recent drilling successes across the vast Pilbara gold field, De Grey’s latest mineral resource estimate (MRE) for Hemi has added approximately 1 million ounces of contained gold.

This was made up largely of resource increases of approximately 0.81 million to 1.9 million oz at the Eagle deport and a jump of approximately 0.14 million to 2.5 million oz at Diucon.

De Grey also reported that the Hemi resource above 390 metres of depth has registered an increase of 0.6 million oz to 9.1 million oz, while the resource below 390m depth had an increase of 0.4 million oz to 1.4 million oz.

“It is great to see Hemi surpassing 10Moz less than four years since it was discovered. Since completing programs to support the DFS earlier this year, drilling at Hemi has prioritised resource extension and new discoveries. This work has paid dividends with resource increases of 0.81Moz at Eagle and 0.14Moz at Diucon,” De Grey’s general manager of exploration Phil Tornatora said.

“Several of the Hemi deposits, including Eagle and Diucon are still open along strike and at depth and show significant potential for further resource increases. We see immediate potential for strike extensions at Hemi to be achieved at Diucon, Eagle and Crow North. All of the Hemi deposits remain open at depth.”

Extensional drilling focus

De Grey’s most recent resource extensional drilling has been focussed on the Diucon-Eagle area since a definitive feasibility study (DFS) drilling was completed.

Some drilling has been also been carried out at the Aquila and Crow deposits with assay results still to be finalised and geological interpretation continuing.

“Our ongoing exploration is targeting strike and depth extensions to the Hemi deposits, new shallow potential resources adjacent to Hemi, as well as new large-scale discoveries at regional prospects. Work by De Grey has also commenced on the new Egina JV [Joint Venture] tenement package held with Novo Resources,” Mr Tornatora said.

Significant growth potential

De Grey managing director Glenn Jardine said that the Hemi discovery is under four years old and that similar large scale gold discoveries experience ongoing growth with additional extensional drilling.

“The company was focused on resource definition drilling until the end of March 2023 that was required for the Hemi DFS that we subsequently released in September. That infill drilling was extremely successful in generating a production profile for the Project that was comprised almost entirely of Ore Reserves.”

“Since then, we have re-focused our drilling programs on making new discoveries and extending existing resources with large step drilling,” Mr Jardine said.

“The drilling programs at and around Hemi are designed to demonstrate longer mine life and increased annual gold production compared to the DFS production profile. We will be conducting new pit shell optimisations on the updated resource and incorporating resource extensions below open pits into the conceptual underground mining study that is currently underway.”

“We see the potential for underground production to occur in parallel with open pit production and within the first five years of production at Hemi, leading to an increased annual gold production rate.”

The current Hemi mineral resource estimate is based on 529 diamond drill holes for a total of 160,833m and 1,104 reverse circulation drill holes for 269,499m including pre-collars, completed between February 2020 and the November 2023 cut-off date.

The Hemi gold deposit is located centrally within De Grey’s 1,500 sq km Hemi Gold project plus exposure to another 1,000 sq km incorporating the Egina JV with Novo and immediately southwest of Port Hedland.

Robust definitive feasibility study

A September 2023 DFS demonstrated a robust Tier 1 project with outstanding financial metrics.

The combined strike of the six current deposits at Hemi is approximately 6km. Where comprehensive drilling has been conducted at the deposits, the combined gold endowment is approximately 25,200 oz per vertical metre.

De Grey believes the high average gold endowment provides strong support for the economic potential of open pit mining.

Drilling during the next 12 months will aim to extend the known deposits at Hemi at depth and along strike and test priority targets within the Greater Hemi region based on geochemistry, geology and geophysics.