It looks like being a tailings led start for junior gold miner Carnaby Resources in north west Queensland.
The company has just released its Pre-Feasibility Study (PFS) on mining the historic Tick Hill site 110 km south-east of Mount Isa.
Carnaby’s primary goal remained the discovery of the fault offset of the Tick Hill orebody said managing director Rob Watkins.
“The Pre-Feasibility Study and Maiden Ore Reserve clearly shows a near term pathway to sole fund the exploration required to achieve this goal through the development of the Tick Hill Gold Project,” Mr Watkins said.
“The tailings and ROM stockpile Ore Reserves of 410,900 t at 1.35 g/t for 17,800 ounces provide a low-risk project start-up with negligible capital requirement and immediate cash flow.
“An engineered design open pit cutback of the historical Tick Hill open pit contains Production Mill Feed of 63,300 t @ 6.14 g/t gold for 12,500 ounces.
“Inferred Resources included in the Production Mill Feed totals 14,700 t @ 4.9 g/t gold for 2,296 ounces representing 8% of the total Production Mill Feed for the pre- feasibility study.”
Additional metallurgical test work results from the tailings dam stockpile confirmed the amenable grinding and leachability characteristics of the ore said Mr Watkins.
The pre-feasibility study comprised a contract mining and toll treatment operation over a 13 month period processing 474,200t at 2.0g/t to recover approximately 27,300 ounces of gold at an All-In Sustaining Cost of A$1,493 per ounce, he said.
“PFS findings confirm an economically viable open pit mine and tailings re-processing project, generating net pre-tax cash flows of approximately $21.7M at an assumed gold price of A$2,300 per ounce he said.
“At an approximate spot gold price of A$2,450/oz, net pre-tax cash flows are $25.6M.”
Maiden probably ore reserve for the open pit are 48,000t at 6.53 g/t for 10,200 ounces.
Discussions with the owners of third party processing facilities and contract miners regarding potential commercial agreements were advanced said Mr Watkins.