Savannah Goldfields (ASX:SVG) is undertaking a regional gold expansion strategy as it seeks to consolidate its landholdings and upgrade the Georgetown gold processing plant from ore mined at its flagship Agate Creek mine
With 6 months of gold production and ongoing processing optimisation, Savannah’s regional gold expansion strategy continues to rapidly evolve as the company completes its transition from gold explorer to producer.
Speaking to Mining.com.au on the sidelines of the Brisbane Mining Investor Conference, Chief Executive Officer (CEO) Brett Thompson says the Gulf Savannah region is a renowned gold producing province with the right geological setting for large-scale gold deposits.
Savannah Goldfields is focused on the Gulf Savannah region in far north Queensland. The company has a wholly owned process plant just outside of Georgetown where it has a major mining operation down in Agate Creek, which 100km by road from Georgetown.
The CEO tells this news service Savannah is strategically well-positioned to take advantage of the opportunity to further expand the ‘hub and spoke’ gold strategy with regional expansion.
“Currently we are mining some relatively small pits in Agate Creek and we’re hauling that material up to the Georgetown process plant processing there. We produce the bullion product, which is gold, silver and we send that to right now we’re sending it to Perth Mint for final refining and ultimate sale.”
Moving forward, Thompson says in the coming 18-24 months it will look to finalise feeding oxide ore from Agate Creek and potentially from some of the other deposits Savannah acquired as part of the plant purchase.
“And there are also a number of stranded assets in and around that Georgetown region that don’t really have a home for their ore that might be looking to us to help them out by processing that dirt. We’d look at that as well, provided it made sense and didn’t displace our own material.”
“And there are also a number of stranded assets in and around that Georgetown region that don’t really have a home for their ore that might be looking to us to help them out by processing that dirt”
Within close proximity to the Georgetown plant the CEO notes there are a number of different potential mining operations in historical mining areas that could be require utilising Savannah’s processing plant.
Savannah’s processing plant was purchased late last year after it had been sitting historically for some 10 years ‘without too much action’ and the company spent a few months undertaking refurbishment works. The company started producing and feeding the plant in late August and early September and has been producing gold since.
Completion of the Georgetown gold processing plant and associated tenement package acquisition completed on 7 November 2022.
Thompson says Agate Creek has a 470,000-ounce JORC 2012, which the company is looking seeking to grow.
“Plus, we’ve acquired a number of resources in and around Georgetown that we need to do some more work on. But ultimately, I see us running the Georgetown plant for the next probably 18 to 24 months on oxides, both from our Agate Creek mining site, but also some of these new acquisitions in and around Georgetown and potentially third party projects as well. At some stage, and at this stage, I think it’ll be during the course of next year or maybe late next year, we’ll look to upgrade the plant to be able to process sulphide minerals or sulphide gold ore. And that essentially means putting in a flotation circuit into the plant. Now, once we’ve done that, that unlocks the potential to process a huge number of sulphide resources that are historically in that area and have really had nowhere.”
The CEO says Savannah is operating in an ideal location and once the company has made the transition to be able to treat sulphide ores, it will have a lot more scope and opportunity to expand its production profile.
For Q4 2022, Savannah continued gold production at the Georgetown gold processing plant from ore mined at Agate Creek. Ore processed for the quarter totaled 33,700 dry tonnes including more than 4,900 dry tonnes of reclaimed historical tailings. The average mill feed grade of 4g/t and overall recovery of 95.5%.
To 30 January 2023, the company has now sold 5,140 ounces of refined gold, as well as 2,574 ounces of refined silver and received gold sale proceeds of $13.7 million since commencement of production in September 2022.
Savannah completed a $15 million capital raise during the Q4 2022 to fund the Georgetown Project acquisition and the start of gold production activities.
Savannah is targeting 2 production centres, the first being Georgetown, for initially processing Agate Creek high-grade ore and a second plant is planned to be established at Agate Creek for the longer term production from that project. The Georgetown processing plant is the only processing plant within a 400km radius and is surrounded by stranded gold mineralisation and dozens of old open pits, underpinning the vision for Georgetown to become a regional processing hub.
Write to Adam Orlando at Mining.com.au
Images: Savannah Goldfields Ltd
