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Black Oak Minerals pours first gold, chisels debt

Published: 07:00 01 Oct 2015 AEST

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Black Oak Minerals (ASX:BOK) has begun production of gold from its Mt Boppy mine with milling ore through its processing facility at nearby Manuka in the Cobar region of New South Wales.

Mt Boppy is expected to deliver a total of 65,000 ounces of gold over an 18 month period.

As an optimised ore blend transitions to achieve maxim um gold output, silver output from Manuka is planned to be reduced. Silver production at the site increased 12% over August to 140,000 ounces.

The Manuka process plant is now running satisfactorily with fuel and other input costs below plan.

The start of production at Mt Boppy has enabled Black Oak to meet its first monthly gold facility repayment of 1500 ounces to the TrailStone Group slightly ahead of schedule. TrailStone inked a landmark $60 million debt package with Black Oak last year when the miner was trading as Southern Cross Goldfields.

In addition, Black Oak has received the proceeds from the balance of its production to date, selling a further 400 ounces of gold at the current spot price of A$1632 per ounce. In addition to repaying part of the TrailStone debt, the company received $A374 per ounce for the gold delivered to TrailStone.

Over two years Mt Boppy is planned to produce a total of 65,000 ounces of gold.

Meanwhile, Black Oak’s Marda gold project near Southern Cross in Western Australia has all mining approvals in hand and is ready for development. Although the project economics are favourable, the company is proceeding with caution in light of market uncertainties and the short life of the project.

Black Oak had $1.2 million in cash as at 30th June 2015.

 

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