Grades support Integra’s Randalls expansion
6th Jun 2012
JUNE 6 – High-grade drilling results are backing plans for a cutback to the existing Salt Creek pit and the potential for underground development to extend the life of Integra Mining’s Randalls gold project in Western Australia.
An updated ore reserve is due in July, but the work already suggests the proposed southern cutback at Salt Creek will add 35,000-40,000oz to the project. Design and optimisation work for the cutback is under way.
Four main target areas have been identified for potential underground mining south of and beneath the cutback, below the eastern wall of the pit and northern extensions. Drilling to test continuity of mineralisation has begun with encouraging visual indications in the area of the cutback.
Salt Creek produced a total 2.88Mt at 2.20g/t for 204,340oz to the end of April.
Integra’s Randalls project is expected to produce 82,000oz in the June 2012 year, rising to 100,000oz in 2013, with continued underground development offering excellent potential to exceed the 2013 target.
The increased production rate, in part from the crusher/classification circuit upgrade due for completion in July, is forecast to generate a $A52M cash profit in fiscal 2013, using a $1,500/oz gold price. Average cash costs of $850/oz are forecast for FY13, reducing to $750/oz by the end of that year.
While no additional underground production beyond the current trial mining at the Cock-eyed Bob deposit has been budgeted for FY2013, Integra is looking to continue production development of Cock-eyed Bob and develop the Santa gold deposit underground that would allow more high-grade feed during FY2013 and provide upside to FY2013’s production guidance.
Integra is in advanced discussions to replace the existing project finance facility with a $20M corporate facility, providing it with the capacity for opportunistic acquisitions. Integra’s total project debt is currently $8.4M, down from an original $45M, a very low level of gearing given Randalls’ defined 5 year open pit mine life and the 1.9Mt stockpile containing over 90,000oz at 1.53g/t for which the mining cost has already been paid.
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