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  • Mutiny Gold Finds GR Engineering Services Joins The Share Register 0 comments
    Sep 20, 2013 1:59 AM

    Mutiny Gold (ASX: MYG) has added well regarded GR Engineering Services (ASX: GNG) to its share register, reflecting the gold plant builder's confidence in the Deflector copper-gold project in Western Australia,

    The company had issued 21,038,603 shares priced at $0.0356 each to GR as payment for preliminary engineering design work for the Deflector processing facility completed thus far.

    Its early engagement of GR has resulted in both the processing plant design and the detailed design of the ball mill at an advanced stage and positions it well to commence equipment procurement once full project financing is received.

    GR Engineering

    GR Engineering is an engineering, consulting and contracting company specialising in fixed price engineering design and construction services to the resources and mineral processing industry.

    Since it was founded in 2006, it has rapidly grown through the completion of design and construction projects and studies for a diverse range of clients, including global mining houses, mid-tier miners and junior developers undertaking their first project.

    Some notable projects that it has undertaken include the engineering, design, procurement, construction and commissioning of the Andy Well processing plant for Doray Minerals (ASX: DRM) as well as design and construction of a 120 cubic metre per hour paste backfill plant at the DeGrussa mine site for Sandfire Resources (ASX: SFR).

    Deflector

    Mutiny's recently updated Definitive Feasibility Study for the Deflector gold-copper project had confirmed that it is robust and highly profitable in today's market conditions given average cash costs of $638 per ounce of gold equivalent and all-in Sustaining costs of $801 per ounce of gold equivalent.

    Start-up capital costs have reduced by around a third to $62 million, whilst maintaining production output.

    The Stage 1 mill upgrade in year 3 increases production to an average of 88,000 ounce of gold equivalent, an increase of 26%, for a low capital cost of $5 million.

    Other highlights include: Net Profit after tax of $180M; NPV of $100M at 8% discount rate; Planning for stage 2 production ramp up to 150,000 ounce of gold equivalent.

    Deflector is contained within the company's wholly-owned Gullewa multi-mineral project licences within Western Australia's Murchison Region.

    It currently hosts a mining inventory of 442,000 ounces of gold, 489,000 ounces of silver and 22,000 tonnes of copper.

    There is considerable potential to substantially increase resources given that the mineralisation is open at depth and along strike.

    Analysis

    GR Engineering's acceptance of shares as payment for preliminary engineering design work for the Deflector Copper-Gold Project reflects its confidence in the project.

    This is hardly surprising given that the project is shaping up to be one of the lowest cost potential (non-producing) gold mines in Australia or Africa thanks to its attractive margins. GR's decision is already vindicated with the Mutiny Gold share price above the imputed entry price for its engineering services.

    Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.

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