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Blackham Resources maintains FY20 gold production guidance

Published: 18:33 23 Dec 2019 AEDT

Blackham Resources Ltd - Blackham Resources maintains FY20 gold production guidance
The company sees potential for further increases in production rates during 2020

Blackham Resources Ltd (ASX:BLK) gold operations at its Matilda-Wiluna Gold Project in Western Australia continue to benefit from recent investments into the mine development.

The company has taken the opportunity to confirm its FY20 gold production guidance of 70,000-80,000 ounces at an all-in sustaining cost (AISC) of A$1,550-$1,750 per ounce.

This represents annual production growth of 7-22% on FY19 which produced 65,406 ounces of gold at an AISC of A$1,760 per ounce.

With the AUD gold price trading at around A$2,145 per ounce, the gold operations are set to continue to generate positive cash flow.

Production in FY20 will be focussed on free milling ore bodies prior to Blackham transitioning to Stage 1 of its Sulphide Expansion Project.

The Stage 1 Expansion Study indicates a production profile averaging 110,000 ounces from FY22 to FY27.

Blackham’s executive chairman Milan Jerkovich said: “The operations continue to perform well in this quarter following on from the September ’19 quarter which is very encouraging.

“This will allow us to achieve ongoing cost reductions to improve operational cash flow and effect our transition to Stage 1 of its Sulphide Expansion Project as outlined in this announcement and unlock the considerable value of the large sulphide reserves and resources at Wiluna.”

Implementing stage 1 expansion

The next steps towards the implementation of the stage 1 expansion project include:

  • Obtaining credit approval for the debt funding package the company has received;
  • Commencement of exploration programs for the conversion of resources to reserves and strengthening and lengthening of the mine plan;
  • Consolidation and strengthening of the management team who will progress the project through to production;
  • Finalisation of key contracts for mining operations and the construction of the concentrator and filtration plant; and
  • Finalisation of off-take and logistics agreements.

Drilling as well as planning for new program underway

Drilling is underway targeting high-grade, free-milling ore bodies at the Golden Age area of the Wiluna underground mine with results to be reported at the completion of the program next quarter.

Golden Age is currently Blackham’s highest-grade producing orebody, and the company continues to test extensions to sustain current levels of production over the next 12-18 months.

Blackham is also in the planning stages of a major drill program to lengthen sulphide reserves and enhance the Stage 1 sulphides mine plan.

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