Westgold Resources’ wholly-owned mining contractor, Australian Contract Mining (ACM), has had its mine development and production services contract at the HBJ operation in Western Australia cancelled.

The ASX-listed company was advised by HBJ owner Northern Star Resources (NST) that it will terminate the contract on a “without cause basis” effective December 23.

ACM continued to provide complete mine development and production services to NST at HBJ following the A$80 million ($58 million) sale of the South Kalgoorlie operations by Westgold to NST earlier this year.

Westgold was under the impression most of the equipment currently employed at HBJ could be placed into immediate use at project expansions within Westgold’s existing operations. It hopes to continue to offer employment to the majority of both fly-in, fly-out and residential personnel employed at the mine.

Related to this, Westgold announced it had just hit first ore at its Big Bell underground mine (pictured), which is a milestone for the ramp up in its Cue gold operations in the Murchison Region of WA. Westgold has been dewatering and refurbishing the Big Bell underground mine for over two years.

The base load for the Cue 10-year development plan is based around the Big Bell underground mine – which is expected to provide 10.1 Mt at 3 g/t Au from the company’s 2020 financial year.