Bass Metals advances operations and exploration at Hellyer Mine

Bass Metals (ASX: BSM) has recently achieved positive operating and exploration outcomes after technical set-backs at its Hellyer operations in northwest Tasmania.

The revised Hellyer mine plan (HMP) is on target with July-August being cash positive. The technical and financial performance of the HMP in July and August indicates a positive outlook for the future.

A financial estimate of total HMP costs and sales for the two month period indicates the HMP operated on a positive cash basis, albeit modestly, with a $500,000 surplus over $10.8 million of operating, capital, environmental and management costs.

Given the significant technical issues managed through this period, Bass would be encouraged by this result as it is consistent with the company’s new revised mine plans.

Importantly, a mine dewatering upgrade is progressing well and the water inflow rate is decreasing.

New safety milestones have also been achieved. In August the company’s operations achieved 365 days without any Lost Time Injuries (LTI) which comes after the Fossey underground mine achieved 500 days LTI free on the 8th June 2011.

Milling

The fifth milling campaign commenced on 1 August, 2011 and was completed on 25 August for a total of 52,863 tonnes.

Mill availability and grind size were all in line or exceeded the mill plan. Zinc and lead concentrate production results were very encouraging with good quality, high-grade concentrates produced and there is further scope to improve the lead and zinc recoveries.

While copper concentrate tonnage was significantly down on plan, payable metal grades were higher than planned and copper recovery is expected to improve in the next campaign.

Lower copper recovery was due to adverse affects of several optimisation trials to improve overall copper recovery and attempts to reduce the levels of lead and zinc in the copper concentrate.

The next milling campaign is scheduled to commence in early October 2011.

Concentrate Sales and Marketing

Deliveries and sales of lead and zinc concentrate to Nyrstar continued as normal. The first shipment of copper off site took place as planned in August, being 500 dry metric tonnes of copper concentrate.

Gold Recovery Study

Positive preliminary results have been obtained from a major, first stage testwork program associated with the current study concerning the potential recovery of gold, silver and possibly base metals from the refractory Hellyer Tails.

A major first stage testwork program to validate and update some of the historical test work (being managed by metallurgical consultancy, BatteryLimits) is nearing completion, after significant delays due to congestion in the testwork laboratories.

The feed stock types comprise either “whole” tailings or a bulk concentrate derived from a flotation pre-concentration phase which reduced the mass by 30% and retained 95% of the metal content.

The gold is refractory because it is largely comprised of fine grains encapsulated within sulphide minerals such as pyrite. The process options tested are designed to break down the sulphide minerals to expose the gold to leaching cyanide solutions.

Exploration

The New McKay mineralised zone shows strong similarities to Fossey/Fossey East and further drilling is underway. Also, an infill program has confirmed the high-grade nature of Fossey East mineralisation.

Corporate

Bass's shares are currently suspended at the request of the company pending an update on its fundraising activities.

A general meeting of shareholders is planned for 26 September, 2011 to seek shareholder approval of various resolutions relating to the recently completed capital raising activities of the company.