Westgold Resources Limited (ASX: WGX) has announced a positive update on its Cue Gold Operations in Western Australia.
The company reported that it has recommenced the underground sub-level cave mining at Big Bell. WGX noted that the new extraction method and significantly enhanced ground support reduces geotechnical risk.
Westgold reported that the first mass cave blast broke approximately 103,000 tonnes at 3.0g/t over 3 levels (510/535/560). The company said that the final piece of Westgold’s Murchison strategy now in place.
Cue Gold Operations
The Cue Gold Operations (CGO) is a subset of the Central Murchison Gold Project (CMGP) located in the Murchison Goldfields of Western Australia.
CGO covers the southern areas and uses the 1.2 – 1.4 mtpa Tuckabianna Plant as a processing hub.
The base load for the CGO 10 Year Development Plan is the Big Bell Underground Mine – providing 10.1M tonnes @ 3.0 g/t from FY2020. Other mines include the Comet gold mine and the Great Fingall mine.
Big Bell underground mine
The Big Bell mine is a single mine covering approximately 1.2km of strike in an overall mineralised lode system. The package of schists known as the mine sequence (the Big Bell Shear) extends over a 20km regional strike. Currently, Westgold remains focussed on the southern part of the strike (Fender to Big Bell).
Gold was first discovered around Big Bell in 1910 with small scale prospects being mined. There were approximately 2.7 million ounces of gold produced from the area in four periods prior to Westgold ownership.
Westgold gained control of the project in 2011 and after several years of detailed evaluation in 2016 set about the monumental task of setting up and re-establishing the mine for long term, sustainable gold production as part of its Central Murchison gold strategy.
Over the past 3 years Westgold has progressively dewatered the underground mine and rehabilitated the historic access development to ≈610m vertical depth.
With the advancement of time and the progression of mining technology, Westgold has re-established Big Bell as a technology driven modern mine.
Change in the extraction sequencing
Westgold reported that it has reversed the extraction sequencing compared to the previous mining phase.
The company said that the ore extraction will now be effected from the centre of the ore system to the limits, with up to 7 levels retreating at any one time carrying a retreating V-shape profile as the mine gets deeper. This change in extraction methodology enables a continuous and more even redistribution of induced ground stress as the cave advances.
Mining at Big Bell
Westgold said that the early drilling at Big Bell has already shown potential for the core of the ore system to expand in strike from the planned 500-600m of strike-length up, to 700-800m of strike-length. Accessing this expansion in strike can be accommodated by simply moving the centroid of the declines away from the core.
The company said that the final rehabilitation of old caving fronts within the orebody has taken longer than anticipated to secure for safe ore extraction.
First blast completed
The company announced that the first mass cave blast was initiated on Monday 2 March, 2020 and paves the way for the planned ramp up in mine output that targets steady-state production rates by the end of CY 2020.
It may be noted that this first mass blast in the cave is non-typical but necessary to invert the cave front blasting approximately 103,000 tonnes over three development levels (510/535/560).
Westgold said that the remediation blast establishes a V-shape cave that should ensure a smooth ramp-up of the northern cave extraction fronts.
The company said that a similar process is now under way for the southern cave front (scheduled for completion in mid-2020) after which all cave excavations will be new and provide greater predictability in scheduling as well as ore tonnage won from the development cycle.
Plans for first year of production at Big Bell
Westgold said that in its first year of production mining, it aims to establish the V-retreat profile before the mine transitions to steady state high output levels of circa 1 million tonnes per annum.
With caving having commenced, the company said that the mine is expected to progressively ramp up to full output by the end of CY 2020. Total output for CY 2020 is anticipated to be approximately 600,000 tonnes at ≈3g/t Au.
Encouraging DD results
The company reported that the recently completed exploratory diamond drilling has revealed excellent high-grade results at widths that enable the extension of the sub-level cave method along strike.
These could quickly amount to increases in key mine metrics of tonnes and ounces per vertical metre and consequently extend the mine life and lower overall production costs.
Other internal opportunities
The company reported that the 1600N, Shocker, and Big Bell South open pits were significant producers and, with limited shallow drilling show good depth continuity of the ore systems together with a significant change in the gold price, may now represent near term underground opportunities.
Further to the south at Fender, an open pit cut-back is currently underway with a planned underground development on that ore system being considered.
Once Big Bell is re-established and operating at steady state, growth at Westgold will be from these internal opportunities enabling the Group to leverage its own mining capability and existing operating infrastructure in line with these targets.
The company said that exploration drilling will accelerate on high priority targets later in this year, in preparation for expansions on the Big Bell line.
Impact of Big Bell and further mining opportunities
Westgold said that Big Bell adds approximately 100,000oz to group output and will be the primary ore source for the Tuckabianna mill, with additional ore coming from targets within the Big Bell, Cuddingwarra, Day Dawn, Pinnacles and Tuckabianna package.
Westgold will thus have the opportunity to truck additional tonnage to utilise the larger capacity and lower cost Bluebird mill with Meekatharra Gold Operations. The Great Fingall, Golden Crown and Cuddingwarra mines represent prime opportunities to implement this plan.
Westgold reported that at Cuddingwarra, 10kms west of Cue, open pit and underground mining opportunities exist at both the Black Swan South and Rheingold prospects.
Westgold reported that it will update the progress at Big Bell during the ramp up period in its Quarterly Reports and specifically on any material variation to its ramp up plan.
It may be noted that the delay in the onset of stoping at Big Bell has impacted the ability for CGO and hence the group to achieve its quarterly guidance.
The company said that whilst that short term consequently impacts the current quarter, the significance of the commencement of production from stoping at Big Bell will see mine outputs align better with guidance for the financial year.
Westgold said that it will look to provide a guidance update for FY 2020 later in the ensuing quarter, as the ramp up progresses.
The company said that Big Bell will remain in a capital development phase until it reaches steady-state production and/or cave front progression enables the targeted 1 million tonne per annum to be achieved.
Westgold’s Executive Chairman, Peter Cook said: “This is a major milestone for Westgold and a terrific achievement by our CGO team. Big Bell has been idle and flooded since 2003 however before that it was one of the largest single mine gold producers in the Australian gold sector.
After nearly 3 years of substantial capital reinvestment and hard toil, we are on the cusp of returning Big Bell to its former glory. Big Bell will become our largest single mine in the Murchison region and restarts with a 10 year mine life with excellent resource extension potential.
Big Bell is key to Westgold’s plans as it represents the last critical piece in our Murchison strategy. Our dominant land position, three operating process plants, over 9 million oz resource base and our unique position as owner operator provides the strategic platform to underwrite more than 300,000 ounces of production per annum in the longer term.”