Egan Street Resources Limited (ASX:EGA) made substantial progress towards developing a new high-grade gold operation at its 100%-owned Rothsay Gold Project in WA during the December quarter.
The company completed a mineral resource update in November after successful extensional drilling programs, recording 1.54 million tonnes at 9.2 g/t for 454,000 ounces of gold.
The increased resource reflects Rothsay’s potential to be a low-cost, high-margin project which can deliver robust financial returns.
Egan Street advanced approvals for the project including permitting and project financing discussions, putting it in a strong decision to make a final investment decision and begin construction.
A works approval and licence application, which is the final development approval for Rothsay, has now been submitted.
The company has also received non-binding offers for financing solutions ranging up to $35 million of conventional debt.
The updated mineral resource incorporated high-grade results generated in a 16-hole diamond drilling program undertaken during the quarter.
The program targeted southern extensions to the Woodley’s and Woodley’s East shears.
Featured results include: 2 metres at 116.9 g/t gold from 264 metres, including 0.3 metres at 776 g/t; and 2.63 metres at 57.2 g/t from 185.1 metres, including 0.5 metres at 216 g/t and 0.48 metres at 66.3 g/t.
Other highlighted intersection were: 1.02 metres at 23.96 g/t from 242.48 metres; 0.7 metres at 18.74 g/t from 149.8 metres; 0.97 metres at 129.2 g/t from 73 metres; and 2.58 metres at 22.6 g/t from 150.5 metres.
A 60-hole, 4,765-metre reverse circulation (RC) drilling program was also completed during the quarter, targeting potential opportunities at the Orient and Clyde East shears.
The program was designed to test below the historic Orient South pit where a proposed portal and decline may be required to access the southern zone of the now extended Woodley’s shear.
Assays from the RC program are pending.
Contracts have been awarded to allow construction to begin once approvals have been received.
A contract for the 100-person camp and non-process infrastructure is anticipated to be executed early this year.
The reverse osmosis water treatment plant and wastewater treatment plant contract has been awarded and is progressing on schedule.
The ‘build, own and operate’ contract for on-site power generation is in the final stages of negotiation with award expected early 2019.
The design and construct contract is ready to award and will begin after environmental approvals are received.
Invitations for tender for the underground mining contract have been received from the market during the quarter.
This contract will involve dewatering, rehabilitation of the existing portal and decline, development works and underground mining activities.