King of the Hills Gold Project
The King of the Hills (KOTH) Gold Project (previously known as “Tarmoola”) is located ~80km south of the Darlot Gold Mine and ~28km north of the town of Leonora in the Eastern Goldfields region of Western Australia.
KOTH was acquired by Red 5 from the leading mid-tier West Australian gold producer Saracen Mineral Holdings (ASX: SAR) in early October 2017, with the acquisition including:
- a JORC 2012 Underground Indicated and Inferred Mineral Resource of 2.71Mt at 4.6g/t Au for 402,000oz of contained gold*;
- a new underground mine design developed by Saracen following a 6-month trial underground mining campaign;
- established site infrastructure located immediately adjacent to the Goldfields Highway; and
- an 11,751ha tenement holding with excellent exploration potential.
The project delivered total historical production for previous owner by past owners including Mt Edon Gold Mines of 1.6Moz from the open pit (28.4Mt @ 1.7g/t – closed in 2004) and 0.3Moz by St Barbara from the underground (closed April 2015).
Underground Mining Potential
Saracen undertook a 6-month trial underground mining campaign at KOTH in late 2016, largely designed to provide a self-funding exploration stream to explore the depth potential of the northern ‘near mine’ opportunities of KOTH, as well as exploration on the southern extremities of the mineralisation.
Based on the results of this work, Saracen developed an entirely new geological model for KOTH and developed a new underground mine design which envisages two mining areas in the southern and central portions of the mine.
Red 5 has engaged underground mining contractor Pit n Portal Group Pty Ltd to review the underground mine plan for KOTH and continue with underground mine dewatering. Pit n Portal was the underground mining contractor for Saracen at KOTH for 2016/17.
Red 5 plans to commence underground operations as soon as permitting has been obtained and a contract with an underground mining contractor completed.
Red 5 will screen about 5,500 tonnes of underground low grade development ore (grading between 1g/t and 1.5g/t) for possible beneficiation of the ore. This will be done to confirm previous studies on ore beneficiation at KOTH and, if successful, will enhance the economics of the underground mine.
A Scoping Study laboratory test work program has also been developed to assess the amenability of both existing low-grade stockpiles and potential open pit ore to heap leach treatment methods.
Initial results from this test work are expected to be available during in the December 2017 quarter.
Red 5 will also commence an immediate review of historical exploration data for KOTH, which has multiple lodes extending over 1.95km and open at depth, providing numerous exploration drilling targets.
* As at 30 June 2017 - Saracen Resource and Reserve Statement dated 2 August 2017