viewRed River Resources Limited

Red River Resources on-track and on budget for Hillgrove Gold Project restart by year-end

Site activities at Hillgrove continue to ramp-up with the restart of gold production expected by the end of 2020 with an operational life of around 12 months.

Red River Resources Limited - Red River Resources on track and on budget for Hillgrove Gold Project restart by year-end
The stage one of the project restart will be based on treating the Bakers Creek Stockpile

Red River Resources Limited (ASX:RVR) is progressing towards the restart of the Hillgrove Gold Project, with gold production remaining on-track to resume by the end of 2020.

The project has a low operating risk and capital costs using a staged restart approach.

Stage one is gold production from the Bakers Creek Stockpile (225,000 tonnes at 2.5 g/t gold) with the production of gold doré estimated to start in December 2020 at an estimated project capital cost of $5 million.

Stage two is the full restart of underground mining operations which is forecast to commence in mid to late 2021 at the Metz Mining Centre with the company aiming for stage two operational life of +5 years producing 30,000 -50,000 ounces gold equivalent per annum.

Metz has a JORC mineral resource of 3 million tonnes at 4.5 g/t and 1.4% antimony (6.5 g/t gold equivalent) with 426,000 ounces gold and 41,000 tonnes antimony contained.

“Low-cost restart plan”

Red River managing director Mel Palancian said: “Gold production at Hillgrove will transform Red River into a diversified, multi-asset gold and base metals producer, with two Australian operations that have substantial growth upside.

“Having acquired the Hillgrove project in August 2019, we have been methodical in our approach to restarting gold production to ensure we understand our opportunities and how best to leverage them.

"Starting operations by producing gold doré from waste at the Bakers Creek stockpile provides us with a low-cost restart plan.

“Then we will follow with Stage 2, which is to restart underground operations from existing development next year.

“We will continue to explore at Hillgrove for gold and critical metals, including antimony and tungsten.”

Metz has a JORC mineral resource of 3 million tonnes at 4.5 g/t and 1.4% antimony (6.5 g/t gold equivalent).

Hillgrove processing plant

Restart activities are progressing as planned, on time and on budget with key activities including:

  • Installation of a gravity gold recovery circuit – engineering completed, equipment is on-site and scheduled to be installed from the beginning of November 2020;
  • Installation of an Intensive Leach Reactor (Acacia) - has been ordered and delivery expected by early December 2020, engineering completed and structural modifications in progress;
  • Primary crusher spares are on-site and ready to be installed;
  • Secondary crusher has been ordered and expected to be delivered within the next four weeks (engineering 50% completed);
  • Rebuilding of feed pumps for filter presses and thickeners underway;
  • Rectifiers and busbars for the gold electrowinning circuit have been ordered; and
  • Leach tanks are being refurbished, gridmesh replaced in the plant area where needed, rebuilding all pumps and running of new pipelines where needed.

The permitting and approval process required to restart operations is well advanced with the majority of consents related to the process of bringing the site out of suspension and modification of existing consents to allow the processing plant upgrade (addition of gravity circuit).

Mobile fleet

As part of the Hillgrove Project acquisition, Red River acquired an extensive fleet of mobile equipment which will be utilised in the mining and haulage of the Bakers Creek Stockpile to the processing plant.

The company has sought to use as much of the existing fleet as possible to minimise preproduction capital costs and has commenced overhaul and servicing activities in preparation for the restart.

The Hillgrove site includes a 250,000 tonnes per annum capacity processing plant.

Growing the mineral resource base

There is substantial upside for an extended mine life and/or increased production rate from the current JORC 2012 mineral resource of 5 million tonnes at 4.3 g/t gold and 1.5% antimony (6.4 g/t gold equivalent) (692,000 ounces gold and 75,000 antimony contained).

Red River is undertaking drilling activities at Eleanora to support the conversion of the remaining material non-JORC 2012 mineral resource (Eleanora-Garibaldi) to a JORC 2012-compliant resource.

Second mining system

The phase one Eleanora Lode drilling program has concluded, with nine diamond drill holes for 832.5 metres completed, targeting unmined gold-rich sections of the Eleanora Lode and the company is confident there is potential for Eleanora as a second mining front at Hillgrove.

Red River has also concluded drilling at Curry’s Lode, with seven diamond drill holes for 704.3 metres completed and assay results expected in early November.

The drill rig has moved back to the Eleanora Lode to commence phase two drilling.

Quick facts: Red River Resources Limited

Price: 0.285 AUD

Market: ASX
Market Cap: $147.57 m

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