The development potential at Laneway Resources’ (ASX: LNY) Agate Creek gold project in north Queensland has been given a boost after the company released a string of high-grade intercepts from a recent round of drilling.
The RC drilling program was undertaken at the projects Sherwood deposit, which is earmarked for initial production.
Numerous and consistent high-grade intersections were encountered during drilling, with several intersections exceeding 100 grams per tonne gold.
Highlights from the drilling program include 3 metres at 32.81 grams per tonne gold, 5m at 12.86g/t gold, 2m at 68.51g/t gold including 0.5m at 250g/t gold and 1.5m at 50.37g/t gold including 0.5m at 106g/t gold.
Laneway said the results showcased the broader potential of the Agate Creek project, which is located 60 kilometres west of the major Kidston deposit.
Agate Creek’s indicated and inferred resource currently contains 381,000 ounces of gold at 1.4g/t gold.
Advancing Agate Creek
Laneway remain bullish on Agate Creek’s “significant upside potential”, with highly prospective nearby targets identified for follow-up work.
Meanwhile, open cut operations at Agate Creek are set to benefit from an existing processing plant which the company said would significantly reduce the overall capital expenditure, and time to first gold production.
The company is seeking to move the asset into operations mode as soon as possible to benefit from the material positive cash flow it would generate at current prices of gold denominated in Australian dollars.
Laneway executive chairman Stephen Bizzell said the high-grade mining venture should establish a “robust financial platform” to progress its considerable asset portfolio.
Its other assets include the Ashford coking coal project in New South Wales and epithermal gold targets in New Zealand.
Native title secured
Laneway has already made inroads on native title arrangements, having executed an agreement with the Tatampi Puranga Aboriginal Corporation for the grant of a mining lease.
Under the agreement, Laneway will provide certain financial benefits, employment, training and business development opportunities for the Ewamian People. The accord also includes a specification for the company to manage the impact of the project on cultural heritage within the agreement area.
Mining and processing will be able to kick off shortly after the grant of the mining lease, which the company said was imminent.
Last year, the Brisbane-based company entered into an agreement for Maroon Gold to process up to 10,000t of Agate Creek’s near surface ore through its plant.
Laneway shares jumped 33.3% on the positive news to $0.004.