CRATER Gold Mining Limited has announced a maiden inferred resource estimate for its HGZ gold mining project, part of the Crater Mountain Project in Papua New Guinea.
The initial JORC estimate is for an inferred resource of 44,500 tonnes at 11.9 g/t for 17,100 ounces of gold at cut- off grade of 5 g/t Au.
Using a higher cut of grade of 7.5 g/t Crater Gold has identified an inferred resource within that resource of 23,500 tonnes, grading at 17.2 g/t for 13,000 ounces.
The company says that with the project already being in production and having gold processing facilities on site, the maiden resource paves the way for increased production with minimal additional capital expenditure or development time.
The company’s technical director, Richard Johnson, said that as part of the resource definition, mapping of the HGZ showed three distinct major high grade gold veins. The three veins are closely linked and are estimated to carry 11,800 ounces of gold.
The company will now refine the mining method for maximum gold extraction from the higher cut-off grade of 7.5g/t Au implementing a revised, more focussed mining plan.
Crater Gold said this will allow more efficient, targeted gold production. The mining plan will be implemented, with the development of the 1930 Level via a new adit which is currently being established.
“This maiden resource marks a significant milestone for the company, confirming the “potential for profitable gold mining from the HGZ project,” Mr Johnson said.
The report also provides us with more detail of the high grade veins enabling us to target more selective mining of the three main high grade veins going forward.
“Whilst the initial JORC resource may seem modest, the gold is accessible and all infrastructure is in place, allowing the company to move quickly to mining of the three veins as well as other cross cutting structures.’
Mr Johnson said the maiden resource estimate only considers the HGZ as identified to date. Development of the 1930 Level will pass through approximately 100m of previously unexplored ground adjacent to the high-grade zone. This area is considered prospective for finding additional gold bearing structures.
Crater Gold believes the potential to increase the resource is also considered substantial given that drilling to date has mostly been confined to a maximum depth of 75m from surface.
However there is also evidence from drilling that gold is encountered at least to a depth of 128m from surface (NEV022) The Company plans to commence in-fill drilling from the 1930 level which is currently under development as recommended.
An external consultant’s report recently suggested that there is an opportunity to expand the resource along strike and laterally with further drilling and mapping, and also to improve the confidence of the mineral resources internally by infill drilling and development.