Empire Resources boosts year-to-date revenue above feasibility forecasts to A$31m

Empire Resources ASX ERL boosts revenue feasibility forecasts gold
More than 18,300 ounces of gold (unaudited) were produced from Penny's Find at an average grade of 4.47 grams per tonne gold at an all-in sustaining cost of A$1,298 per ounce for the entire open pit operation.

Gold producer Empire Resources (ASX: ERL) has had a positive June quarter boosting its year-to-date revenue above feasibility study forecasts to more than A$31 million from mining at its flagship Penny’s Find gold mine near Kalgoorlie in Western Australia.

During the period, Empire recovered 28,134 tonnes from the Penny’s Find open pit, which was transported to the Lakewood Mill for toll treatment and produced an average gold head grade of 6.68 grams per tonne.

Around 5,620 ounces of the precious metal was recovered, which generated the quarterly revenue of A$9.8 million.

The average price attracted for the metal was A$1,743/oz, while all in sustaining costs were A$872/oz.

Gold sales during the June quarter advanced the company’s year-to-date revenue to more than A$31 million – 5% higher than the feasibility study estimate of A$29.6 million.

Preliminary accounts indicate the operation yielded Empire Resources a profit of A$1.4 million.

Underground gold potential

The June quarter heralded the end of the open pit campaign in April, with Empire working on a feasibility study to move a much longer-term operation underground to target higher grade gold mineralisation that exists at depth.

Penny’s Find has an underground resource of 248,000t grading 7.04g/t gold for 56,000oz. The resource is directly under the open pit and extends to 250m depths, with mineralisation remaining open.

A drilling program has been planned to upgrade the inferred resource, so it can be incorporated into the underground definitive feasibility study.

However, unlisted company Brimstone Resource, which holds a 40% interest in the project, has refused to fund its share of the campaign and sign underground permit applications.

Brimstone Resources

Penny’s Find is operated under a joint venture with Empire owning the majority 60% stake.

The joint venture was terminated earlier this month after Brimstone defaulted on a A$1 million payment to Empire back in June, which was prescribed under the joint venture agreement.

Empire has appointed a receiver to secure Brimstone’s 40% interest and recover the owed funds.

According to Empire, a final investment decision will be made to progress Penny’s Find underground once it has resolved the Brimstone situation.

Advancing into copper-gold, zinc-lead and silver

Meanwhile, Empire has been advancing its Yuinmery copper and gold project, which is 80km from Sandstone in WA.

During the June quarter, Empire reported it had unearthed 12m at 2.05% copper and 0.31g/t gold, with a 2m interval containing 5.1% copper and 0.50g/t gold.

Additionally, Empire has moved to secure the Barloweerie zinc, lead and silver project, which is also in WA.

Once Empire has been granted the 113 square kilometre exploration licence it will evaluate existing detailed aeromagnetic to firm up potential drill targets.

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