Westgold Resources (ASX:WGX,TSX:WGX,OTCQX:WGXRF) has completed a scoping study that evaluates an expansion of its Fortnum gold operation in Western Australia, the company said on Tuesday (December 17).
The study forms part of the company’s portfolio review, and shows a potential 10 year, fully integrated mine plan.
It outlines life-of-mine production of 713,000 to 871,000 ounces of gold, and covers Fortnum’s Starlight, Nathan’s and Yarlarweelor open pits, as well as the existing Starlight underground operation.
Also included in the study is a 91 percent increase in Starlight’s resource estimate. It now stands at 12.9 million tonnes at 2.7 grams per tonne gold for a total of 1.13 million ounces of gold.
“Fortnum is a mature, yet under drilled asset and is one of Westgold’s most profitable and productive operations,’ said Managing Director and CEO Wayne Bramwell, adding that Starlight has so far produced 800,000 ounces of gold.
“The scoping study contemplates a modest upfront capital investment to deliver a long life, fully integrated open pit and underground project of increased scale, supported by an expansion of our existing (900,000) processing plant to 1.5 million tonnes per annum,” he added in Tuesday’s press release.
Westgold said funding amounting to approximately $294 million will be needed over the expansion’s life. On a respective basis, open-pit pre-production capital, processing plant capital, life-of-mine underground capital development and working and exploration capital will require $39 million, $93 million, $113 million and $48 million.
Shares of the company rose as high as AU$3.25 in the wake of the news.
Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.