Redcastle Resources (ASX:RC1) expects the Queen Alexandra gold project in Western Australia to be high-returning following completion of an independent Scoping Study.
The Scoping Study, completed by Mining One Consultants, focused on various options to maximise near-term cashflow by evaluating the potential of staging the open pit development.
Under the multi-stage pit development, the study outlines 73,000 tonnes @ 3.83 grams per tonne gold of resources are available for milling at the end of the five month. This exceeds the assumed minimum parcel size of 50,000 tonnes of toll treating, producing 8,300 ounces of gold.
Over a 10-month mine life, Queen Alexandra is forecast to generate an estimated pre-tax cash surplus of $14-15 million, with the project revenue expected to be $65.6 million.
Pre-mining capital and start-up costs are estimated to be $6 million, with between $21 and $22 million of funding requirements estimated based on a combined stage one and two pit.
Redcastle has begun discussions and is evaluating options for a toll milling agreement while also assessing a joint venture proposal relating to production and milling operations.
Chairman Raymond Shaw says the release of the Scoping Study further reinforces the project’s significance.
“With strong grades, straightforward metallurgy, and close proximity to existing processing infrastructure, the low-risk development outlined for the initial shallow pit design confirms the potential for near-term production,” Shaw says.
“Our multi-stage pit development reflects our disciplined approach to cost and execution risk management, including the potential of the deeper stage three pit development which may provide access to higher grade mineralisation at depth via underground mining opportunities.”
The Queen Alexandra Project is part of the broader Redcastle Project located 58km east-southeast of the Gwalia Gold Mine.
Write to Aaliyah Rogan at Mining.com.au
Images: Redcastle Resources
