TIDMGRL
RNS Number : 2801T
Goldstone Resources Ltd
17 July 2020
17 July 2020
GOLDSTONE RESOURCES LIMITED
("GoldStone" or the "Company")
Extended resource drilling and updated DEP
GoldStone Resources Limited (AIM: GRL), the AIM quoted gold
exploration and development company focused on bring its
Akrokeri-Homase Gold Project ("AKHM") into production, announces
that, in line with progress towards commencing production at the
Homase South Pit and construction of the associated heap leach
facility, the Company has planned an additional infill RC drilling
programme with the objective to increase the mineable resource at
depth at the Homase South Pit, which is expected to commence
shortly.
The Homase South Pit, the first of the three open pits planned
to be brought into production as detailed in the Definitive
Economic Plan ("DEP") for its Akrokeri-Homase Gold Project ("AKHM")
announced on 27 June 2019, extends 1,500 metres southwards from the
historic Homase Main Pit, see Plan 1, which produced 52,500 oz gold
at an average grade of 2.5g/t Au in 2002/03 by AngloGold
Ashanti.
The proposed programme will seek to further define and extend
the mineable resource down-dip at the Homase South Pit to a
vertical depth of approximately 60 metres. As defined in the DEP,
the Homase South Pit is currently targeting the oxide resource to a
vertical depth of 30 metres. The programme will build on previous
drilling completed by Goldstone in 2011-2012, which defined the
Company's existing JORC resource, and which indicated increased
grades in this area of 1.4g/t to 2.5g/t below the weathered zone of
30 metres.
The Company is also considering an additional drilling programme
within the Homase Trend, extending northwards, by approximately
2,000 metres from the historic Homase Main Pit, encompassing the
proposed Homase Central and North Pits, being the other two open
pits defined in the DEP, see Plan 1, and the historical exploration
pit, to the same depth of 60 metres, to further increase the
mineable resource defined within the DEP.
Plan 1: Location plan of Proposed Mine
http://www.rns-pdf.londonstockexchange.com/rns/2801T_1-2020-7-16.pdf
The Board has also updated the financial model utilised for the
DEP to bring it in line with the current gold price of
approximately US$1,800/oz (versus US$1,300/oz used in the initial
DEP) and to capture a reduced initial CAPEX of US$3.0m (versus
US$6.9m in the DEP). As noted in the Company's announcement of 30
June 2020, this reduced initial CAPEX approach enables the Company
to achieve first production within the timetable envisaged in the
DEP whilst deferring certain elements of the project (including the
elution plant, electrowinning and Gold Room) such that they can be
funded from production cashflows. The combined effect of an
increase in the gold price and the reduction in initial capital
outlay is estimated by the Board to increase the originally
estimated project NPV from US$19.5m to US$34.5m and the IRR from
143% to 382% (at a 10% discount rate and excluding financing
costs).
As detailed in the announcement of 27 June 2019, the DEP
encompasses three open pits along the Homase Trend together with
tailings from the Akrokeri Mine. The first of the three pits
planned for production is the Homase South Pit, in respect of which
the mining lease has been awarded. Following completion of the
recent funding and in line with the Company's reduced initial CAPEX
development plan, the Board anticipates, subject to timely receipt
of the requisite environmental and operational permits, that the
first gold pour from the Homase South Pit will be achieved in Q4
2020.
Whilst the lease initially only relates to the Homase South Pit,
the DEP has been approved by the relevant authorities in Ghana in
its entirety and the lease can therefore be renewed and/or extended
to include additional pits along the Homase Trend as the Company's
production plans advance.
The Company continues to work closely with the Ghanaian Minerals
Commission and the Environmental Protection Authority to finalise
the environmental permit and the Board expects that the
environmental and operational permits will be awarded in the next
few weeks. On receipt of the relevant permits, the Company will be
in a position to immediately commence mining operations at the
Homase South Pit, utilising contract mining, and construct the heap
leach plant, with the target of achieving our first gold pour in Q4
2020.
Emma Priestley Chief Executive Officer commented:
"The updated DEP, to reflect the current gold prices and our
current development plan, demonstrates the attractiveness of the
AKHM project. The potential to further expand the mineable resource
through the planned additional drilling programmes also offers
further potential upside though our ability to increase the minable
resource. We continue to believe that AKHM has the ability to
deliver significant value for all shareholders, and we look forward
to keeping shareholders updated as we move forward to achieving
first gold production in Q4 2020."
For further information, please contact:
GoldStone Resources Limited
Emma Priestley Tel: +44 (0)7867 785 177 / +233 (0)55
581 8855
Strand Hanson Limited
Richard Tulloch / James Tel: +44 (0)20 7409 3494
Bellman
SI Capital Limited
Nick Emerson Tel: +44 (0)1483 413 500
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014.
About GoldStone Resources Limited
GoldStone Resources Limited (AIM: GRL) is an AIM quoted gold
exploration and development company.
The Company is focused on developing the Akrokeri-Homase project
in south-western Ghana, which hosts a JORC Code compliant 602,000
oz gold resource at an average grade of 1.77 g/t. The existing
resource is confined to a 4km zone of the Homase Trend, including
Homase North, Homase Pit and Homase South.
The project hosts two former mines, the Akrokeri Ashanti Mine
Ltd, which produced 75,000 oz gold at 24 g/t recovered grade in the
early 1900s, and the Homase Pit which AngloGold Ashanti developed
in 2002/03 producing 52,500 oz gold at 2.5 g/t recovered. It is the
Company's intention to build a portfolio of high-quality gold
projects in Ghana, with a particular focus on the highly
prospective Ashanti Gold Belt.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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