ASX-listed AuStar Gold has confirmed it will re-start mining activity at the historic Morning Star and Rose of Denmark mines in Victoria, Australia, this month.
The company, in December, said it was looking to reach the mining milestone at both projects this quarter. AuStar said it had now gained a “requisite level of confidence in its minerals inventory estimation and mine planning to start production”.
AuStar Gold CEO Tom de Vries said the decision to commence production reflected the progress that had been achieved with recent exploration activity.
de Vries said: “We have repeatedly witnessed diamond drill core with visible gold and accompanying outstanding high-grade assay results, which gives us confidence that mining can be undertaken successfully.
“Our process plant is proven, the infrastructure is all well tested, and our exploration work gives us confidence that we have high-grade material available for mining. We have conducted extensive work internally to assess potential production rates and costs and the board and management are confident the decision to commence production will generate positive results for shareholders. While initial throughput rates will be modest, further exploration success will enable increased production over time,” he said.
AuStar Gold’s mine development plan will initially focus on exposing the reef at McNally’s and thereafter develop along the structure then targeting the stoping on the highest-grade drill holes.
Following an initial pre-development stage, a similar approach will be taken to the selective mining of Stone’s Reef, targeting zones where high-grade gold drill holes proliferated.
Development is expected to begin in the first week of February with logistics and procurement activity already underway. Processing at the Morning Star gravity processing plant is expected to start before the end of February.
The company said it has identified an initial gold mineral inventory to sustain production over the next six months, with the objective of continuing to replace and add to the current mineral inventory via ongoing exploration. The plant will initially operate at around 85,000 t/d throughput on a week on/week off basis, which is expected to increase in the next six months.
AuStar Gold said Morning Star is a proven past producer, with 830,000 oz at 26.5 g/t Au. It also comes with significant shaft access infrastructure in place and multiple high-grade zones identified and untested high grade intercepts.
The Rose of Denmark mine, meanwhile, has a long predictable dyke zone, vastly unexplored, with a fully refurbished circa-3 m wide adit suitable for mechanised mining and ore capable of processing through the fully recommissioned processing plant, AuStar said.