Empire boosting production and cash flow from Penny’s Find

Empire Resources ERL ASX Penny's Find toll treatment
Ore being transported from Empire Resources' Penny's Find gold mine.

Gold miner Empire Resources (ASX: ERL) is keeping its pedal to the metal, ramping up production with a second toll treatment campaign of 30,000 tonnes of ore.

The second campaign at the Lakewood mill on the southern outskirts of Kalgoorlie-Boulder in Western Australia will run concurrently with ore being processed through the Burbanks Mill at Coolgardie.

Richer ore improves cash flow

Importantly for Empire, with the open pit at its Penny’s Find joint venture having now reached a depth of 50 metres, higher grade ore will be heading to the mills, leading to progressively higher cash flows.

Empire Resources chief executive, Mr David Sargeant, said the company expected to issue a mining and processing market update in early December which would cover the production picture up to the end of November.

Already Empire has announced that it has produced more than $2 million of gold from the initial production campaigns at Lakewood and Burbanks after mining started at Penny’s Find, 50 km northeast of Kalgoorlie, in May of this year.

Toll treatment saves on capex and speeds revenue

The decision to use toll treatment plants has reduced capital spending and sped up revenue generation which has helped Empire Resources to continue exploration in the hope of extending mine life to at least ten years with an underground mine extension.

So far the signs for progressing below the open pit stage have been positive with grade control and diamond drilling producing excellent grades, confirming the geological model of higher grades at depth for the deposit, which extends 250 metres deep and remains open.

Underground feasibility study key to extending mine life

A feasibility study is progressing and there is potential to add to the current underground indicated and inferred resource of 170,000 tonnes grading 5.40g/t gold.

Importantly the first treatment campaign showed that Penny’s Find ore was free milling with good recoveries from the gravity circuit at Lakewood producing the first gold pour.

Gold recovery at Lakewood has been excellent at 94 per cent, with 44 per cent of the gold recovered in the gravity circuit.

Empire is expected to update the underground resource estimate and release a final feasibility study into an underground operation in the next few months.

John is a highly experienced business journalist and formerly chief business writer for the Herald Sun. He has covered Federal politics in Canberra, was Los Angeles Bureau chief for News Limited and was also chief of staff for the Herald Sun. He has covered a wide range of small and large cap ASX stocks and has a special interest in mining and technology.