ASX-listed aspiring gold developer, Kingwest Resources has kicked off another round of reverse circulation drilling targeting depth extensions to a triumvirate of key near-surface satellite deposits that form part of its flagship Menzies gold project in WA. The Perth-based company will look to delve deeper at the project’s Lady Shenton, Lady Harriet and Yunndaga systems to test for gold mineralisation beneath the current indicated and inferred resources for each.
Kingwest plans to punch out 20 RC holes for an aggregate drilling coverage of about 4,000m in the current program after a clutch of recent high-grade gold hits at depth from the Pericles, Stirling and Lady Shenton deposits.
Stand-out intersections from earlier drilling this year were 2m at an average grade of 17.32 grams per tonne gold from 125m including 1m at 30.8 g/t at Pericles, 1m at 19.09 g/t from 103m at Stirling and 12m at 3.72 g/t from 102m including 5m at 6.79 g/t at Lady Shenton.
In March this year, the company released updated near-surface global mineral resource estimates covering the bevy of Menzies satellite gold deposits following more than 40,000m of RC and diamond drilling.
The combined numbers came in at 11.05 million tonnes grading an average 1.26 grams per tonne for 446,200 ounces of contained gold at a 0.5 g/t cut-off grade.
Using a 1 g/t cut-off, the latest overall Menzies indicated and inferred mineral resource converts to 5.36 million tonnes at 1.83 g/t for 315,500 ounces of contained gold.
Menzies is situated about 130km north of Kalgoorlie.
Also in March, Kingwest tabled an encouraging scoping study on a proposed open-pit gold mining and third-party toll treatment operation that projects total free cash flows of $80 million across an initial 31-month life of mine plan.
According to the study, mining of eight open pits at Menzies and toll processing of the higher-grade and medium-grade ore culminates in the production of 155,000 ounces of gold from 2.39 million tonnes of milled ore going at 2.02 g/t.
Applying a 95 per cent recovery rate reduces forecast gold production for the initial 31-month period to 147,200 ounces.
Funding of about $20 million will likely be required for capital works and pre-production working capital, the company says.
Now that we have proved up significant near-surface mineral resource estimates at Menzies and the economic case for mining them in our scoping study completed in March 2021, it is time to pursue deeper high-grade extensions that could be included in future underground mineral resource estimates. Our extensional drilling already completed has intersected numerous very high-grade mineralised zones that warrant more extensive drilling.
Kingwest successfully rattled the tin for $3 million this week in a capital raise that will see its issued capital structure expand by 37.5 million shares to just over 200 million shares.
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