Orinoco working on plan to restart Cascavel

PERTH (miningweekly.com) – An independent technical review of the Cascavel gold mine, in Brazil, has advised a restart of the mine, concluding that the mine and plant issues experienced during the start-up were common commissioning problems that could be readily fixed.

Gold miner Orinoco Gold in October suspended operations at Cascavel as the mine failed to meet expectations. The independent review was launched, focusing on the process plant, ongoing metallurgical issues affecting the concentrate, and the development and scheduling.

The review found that gold recoveries at Cascavel were most likely impacted by the insufficient liberation of gold from ore and from operator error during the first two months of operation at the plant.

The report, by SRK Consulting and Mining Plus, has concluded that the lack of an adequate working capital buffer was also a key factor curtailing the commissioning and ramp-up process.

The report provided a number of recommendations to address the plant and gold recovery issues, increasing the availability of high-grade ore from the mine and providing a strong basis to re-establish mining and processing operations in the near term.

Orinoco reported on Monday that it was working to develop and finalise a remedial action plan that would see Cascavel resume operations as soon as possible.

The plan includes increasing the amount of high-grade ore being delivered to the processing plant by revising the mine plan to access the higher-grade southern portions of the mine, improving gold recoveries by enhancing the liberation of gold from the ore, providing additional training to employees, and increasing the amount of working capital available to the company.

To fund the action plan, Orinoco will launch a A$12.2-million nonrenounceable entitlement offer.

Eligible shareholders will be allowed to subscribe for four shares for every seven shares held, priced at 7c a share, with one free attaching option issued for every one share. The options will be exercisable at 11c each, and will expire at the end of January 2020.