Allied Gold shares boosted by huge 45% increase in gold resource in Papua New Guinea
proactiveinvestors.com.au
Allied Gold Ltd (ASX: ALD) has increased gold resources by 45% to 4.7 million ounces at the Simberi Gold Project. This follows further significant increases in Measured, Indicated and Inferred gold Resources through ongoing exploration success.
Investors cheered the increase in resource, lifting the stock by over 10%.
Allied's gold resources are located only 60 kilometres from the Lihir Gold (ASX:LGL) Project, which has a 40 million ounce gold resource. A Pre-feasibility Study is currrently evaluating the potential for 80,000 to 100,000 ounces of gold production from these resources per annum.
Allied’s strategy has been to add to the gold inventory on Simberi Island, achieved by defining additional oxide resources and conversion of these and known resources into reserves with a view to expanding annualised gold production from current levels of 84,000 ounces, and to generate and drill test gold and base metals targets identified on the nearby Tatau and Big Tabar islands.
Since acquiring control of the asset in 2005 Allied Gold has so far increased resources by 3.2 million ounces and reserves by 372,000 ounces in approximately 4 years at a discovery cost of less than US$10/oz.
A gold mineral resource upgrade of the Pigiput area has resulted in new total Measured,Indicated & Inferred Resources for all material types greater than 0.5g/t gold of 2,208,000 ounces which is an increase of 1,451,000 ounces. The Pigiput mineralisation remains open to the north, west and east.
Combined silver resources from the Sorowar deposit results in total Measured, Indicated and Inferred
Resources of approximately 10 million ounces of silver.
The major resource increase has been in the sulphide material as a result of the deep down dip material and inclusion of additional sulphide intersections from holes drilled after 2004, and a change in the sulphide estimation methodology.
Stage 1 metallurgical testwork is now complete and has focussed on comminution and flotation optimisation. Preliminary results on the flotation are very encouraging with a reduction in concentrate mass pull to below 15% while retaining recoveries above 85%. The company has initiated engineering work to optimise the performance of the existing CIL plant. The optimisation will investigate the expansion and increase in the processing capability of the CIL plant to allow mining of Pigiput oxides in conjunction with Sorowar oxides and to establish requirements to possibly treat concentrate tails or an oxidised concentrate product.
Further substantial increases to the Resource and Reserve position are likely due accelerated exploration with mobilisation of additional drill rig and support equipment. Total rigs on site are now five. |
