Empire secures funding for Penny's Find

PERTH (miningweekly.com) – ASX-listed Empire Resources has secured A$7.5-million in funding to bring its Penny’s Find gold mine, in Western Australia, into full production.

The company has singed a binding term sheet with Blue Capital Services, which will fund mining and related costs to a maximum of A$7.5-million, until the operation was cash flow positive.

The agreement covers only the openpit mining operations, and is subject to a formal mining services agreement being signed, as well as corporate overheads being funded by Empire.

“The agreement with Blue Cap now ensures the Penny’s Find gold project has adequate working capital for initial mining of the openpit,” said Empire MD David Sargeant.

“All agreements for mining, haulage and treatment of Penny’s Find gold ore are now satisfactorily in place, allowing the project to make the immediate transition to mining.

“A recently re-designed pit and new mining schedule will also allow Empire to mine at a faster rate than previously anticipated, with considerable cost savings.”

Full scale mining at Penny’s Find is expected to get under way in April.

The Penny’s Find project is expected to generate about A$7.6-million free cash flow in less than a year, based on a probable ore reserve of 146 000 t, at 4.62 g/t gold.

Ore from the single openpit mine will be transported to the Lakewood Mill, owned by Golden Mile Milling, where it will be toll treated. A December toll treatment agreement allowed for between 15 000 t and 20 000 t of ore to be treated during each treatment campaign at the Lakewood Mill.

Empire is currently working to eventually take the mine underground at Penny’s Find, as the gold mineralisation extends to at least 250m in depth, where it remains open with a current known deeper resource inventory of 170 000 t at 5.40 g/t gold beneath the openpit.