Gold Road Resources (ASX:GOR) has begun drilling to assess the potential for a future underground operation at the Gruyere Gold Mine in Western Australia.
The company anticipates the 60,000m diamond drilling program will increase the mine life well beyond the current open pit ore reserve life to 2032.
This news comes after Gold Road revealed the 2025 annual guidance for Gruyere, which is in the range of 325,000 to 355,000 ounces at an attributable all-in sustaining cost (AISC) of $2,400 and $2,600 per ounce.
Gold Road says the increase in production follows the stripping down of the stage-four pit last year to gain full access to the ore body. This enables the delivery of higher grade run-of-mine ore from the mine to the process plant.
As of 31 December 2024, Gruyere had produced 1.52 million ounces of gold at an average attributable AISC of $1,610 per ounce.
Meanwhile, the company’s three-year production outlook for Gruyere ranges between 335,000 and 375,000 ounces per year.
The increasing production is anticipated to be delivered by higher mill head grades and improving plant throughput rates, following the commissioning of a third pebble crusher in late 2023 and further upgrades to the processing plant circuit planned this year.
Gold Road notes the outlook requires minimal growth capital but benefits from the planned increased material movement rates.
With the strong production outlook, Gold Road expects Gruyere to deliver 2 million ounces in 2026.
Once achieved, Gold Road will receive an uncapped 1.5% net smelter return royalty from Gold Fields (NYSE:GFI) on its 50% share of production.
The Gruyere mine is a 50:50 joint venture between Gold Road and Gold Fields.
Gold Road Resources is a mid-tier Australian gold producer and explorer.
Write to Aaliyah Rogan at Mining.com.au
Images: Gold Road Resources
