Crater Gold Mining has made its first gold sale since the installation and commissioning of its new custom-made gold processing plant at the High Grade Zone (HGZ) project at Crater Mountain, Papua New Guinea (PNG). The company has received $351,000 from gold production. The processed material was largely sourced from stockpiled material derived from initial development work at the HGZ project. Gold recovered from the stockpile was from a combination of country rock and initial development along structural veins to delineate mineralised zones of higher gold tenor. Production is expected to ramp up rapidly over the next few months as new material is sourced from the higher grade material of the central high grade gold block of the HGZ mine. With the improved understanding of the geology and controls to mineralisation, processing material is now sourced entirely from the higher grade mineralised veins resulting in improved grades and recovery of gold.
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PNG General Manager Richard Johnson: “Our objective of becoming a profitable, low cost, high margin gold producer is nearing fruition, with the upgraded processing plant now up and running. We are excited to have generated our cashflow following the plant upgrade and, importantly, to observe that the new plant is working to expectations. A third hammer mill is currently being installed which will allow continuous operation of two mills, substantially increasing throughput going forward.
“Our focus remains on ramping up production to full capacity over the next three months, as mining focuses on the gold rich structure(s) within the ‘central high grade’ block of the HGZ.”
The new plant with high speed primary centrifugal concentrators as well as secondary shaking tables is more efficient than the previous test plant and it is expected that this will yield a satisfactory grade of gold. Development above the 1960RL level has been opened up with 2 sublevels and a third underway, preparing blocks for regular production mining. This will increase both the rate of mining and grade of material being mined. A second adit level at 1930RL is planned to commence to open up a 30 m depth extension of the central high grade zone. The remaining stockpile as well as tailings arising from the test plant operation will be processed through the updated plant in due course.
While the current focus is on the HGZ mine, there remains potential to increase the JORC compliant resource of 24 Mt at 1.0 g/t Au at the nearby Mixing Zone project at Crater Mountain. Crater Mountain is located 50 km southwest of Goroka in the Eastern Highlands Province of PNG. Formerly a tier-1 BHP asset, there has been in excess of 14,500 m of diamond drilling to date, the majority focussed on the Nevera prospect, which hosts the HGZ mine and Mixing Zone project.
The Crater Mountain geology is structurally complex with all the hallmarks of a large mineralised system. It is highly prospective for the discovery of a world class multi million ounce gold deposit. Local geology is dominated by the Crater Mountain Volcanic Complex, one of a series of strato-volcanoes situated in the PNG thrust belt along the leading edge of the Australian Continental Plate. The volcanic complex includes two large craters over 1 km in diameter, and approximately thirty small vents along with hot springs and associated sub-volcanic intrusives spread over more than 200 km2 formed after two separate phases of volcanism which are underlain by marine sediments of the Chim Formation. Mineralization and alteration is widespread in the volcanic sequences and the Chim Formation.