Excelsior positive on Kalgoorlie North outlook

PERTH (miningweekly.com) – Gold miner Excelsior Gold is expecting to produce between 18 500 oz and 20 000 oz of gold during the six months to June, as ore production starts from the Zoroastrian Central pit, at its Kalgoorlie North gold project, in Western Australia.

The first phase of mining at the Kalgoorlie North project would be completed this week, with mining coming to an end at the Castlereagh, Jackorite and Big Blow South pits.

The next phase of mining had already started, with two mining fleets operational at the Zoroastrian Central openpit, and a third smaller fleet preparing for mining at the high-grade Zoroastrian Extended pit.

Excelsior told shareholders on Monday that some 132 000 t of ore, grading 2.02 g/t of gold, for some 8 600 oz of gold had been recovered from the three small openpit mines.

With the start of mining from the Zoroastrian Central pit, production was set to increase to between 300 000 t and 320 000 t of ore during the six months to June, grading an average 1.94 g/t gold.

Meanwhile, all-in sustaining costs for the six months to June were expected to reach A$1 270/oz, with the high cost reflecting the earthmoving costs associated with waste removal in the upper part of the Zoroastrian Central pit.

The cost also included a loan servicing cost associated with a A$4.5-million Macquarie Bank loan facility, of which A$3.18-million remained undrawn.

Excelsior currently had an ore treatment agreement in place with gold miner Norton Gold Fields, under which a minimum of 500 000 t/y of Excelsior’s ore would be treated at the Paddington mill, over the next five years.

First ore from the Kalgoorlie North project was hauled to the mill in December last year.

Since the first delivery of ore to the Paddington mill, Excelsior had received A$4.07-million in upfront cash payments from Norton, out of a total provisional revenue of A$9.92-million.

The remaining provisional revenue would be due for payment as soon as final gold recovery data was received for each of the other ore batches.