Empire Resources’ processing campaign on schedule, underground resource imminent

Empire Resources ASX ERL processing campaign underground resource Penny's Find gold mine
Empire Resources' Penny's Find gold mine.

Empire Resources (ASX: ERL) has announced its latest gold processing campaign remains on schedule, with 2,289 ounces gold recovered by the end of November and a new underground resource due to be released shortly.

This latest campaign was undertaken at Golden Mile Milling’s nearby Lakewood Mill which processed 21,194 tonnes of Penny’s Find ore to recover 2,289oz gold in this second campaign.

Additionally, Lakewood Mill has boosted Empire Resources’ processing allocation from 25,000t to 36,000t.

Once sold into the market this should generate more than A$3.4 million at the company’s base case A$1,500 gold spot price. If sold at today’s spot price which is sitting at A$1,660, Empire stands to bring in a substantially larger sum, with the feasibility study allocating an extra A$2 million in revenue for every $100/oz over the $1,500/oz base.

By the end of November, processing at Lakewood had achieved a 93% gold recovery rate, with 38.1% of gold picked up in the gravity circuit.

At this stage, Empire Resources anticipates the average head grade was 3.60 grams per tonne, but the final number is dependent on mint refining data.

This grade is 1.22g/t higher than the 2.38g/t achieved in the maiden campaign which recouped about 1,500oz gold.

Meanwhile, over at the Burbanks Mill in Coolgardie 576,000oz of gold was recovered from 21,239t of ore by the end of November. There was also 200oz of gold dore sent to the Perth Mint for further refining.

Empire Resources reported treatment at Burbanks had not met the company’s expectations and has issued a termination notice to the mill owner Eastern Goldfields Milling Services.

Under the contract, Empire Resources is required to continue delivering ore to Burbanks for the next 30 days until the notice period expires.

Once the Burbanks agreement is expired, Empire Resources plans to use Lakewood or another facility closer to the mine site, which will potential lower haulage costs.

Empire Resources currently has a memorandum of understanding with Poseidon Nickel (ASX: POS) investigating the use of Poseidon’s massive Black Swan plant which is less than 50km from Penny’s Find.

Underground resource upgrade on the way

With an existing underground resource of 170,000t at 5.40g/t gold, Empire Resources is carrying out a feasibility study into migrating Penny’s Find from open pit to underground.

An upgraded resource announcement is imminent, with previous announcements stating Penny’s Find underground mineralisation remained open at depth.

Lorna has more than 10 years experience as a finance journalist and editor. She has written for an array of industry publications reporting on various sectors, including: resources, energy, construction, biotech, pharma, science and technology, agriculture, and chemicals. Specialising in resources, Lorna has covered a myriad of small and large cap ASX and dual-listed stocks.