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Reed Resources Awards Key Mining Contract For Meekatharra Gold Project

Reed Resources (ASX: RDR) has ticked another box on its path to the first gold pour at its Meekatharra Project in Western Australia with the awarding of the Stage 1 Mining Contact to Minepower.

Minepower will begin mobilising to site from 1 October 2012 with mining of the Bluebird Open Pit, which hosts a resource of 1.53 million tonnes at 1.9 grams per tonne gold, to begin shortly after.

Bluebird is located less than 1 kilometre from the Bluebird processing plant.

Luke Tonkin, managing director, said the award of the mining contract is a significant milestone for Reed, the Meekatharra community and the State as it clearly signals the commencement of production activity and associated benefits that flow from gold production.

"The construction and refurbishment works program at Meekatharra is nearing completion with all the major work packages being completed as scheduled and within estimated cost.

"Reed is successfully transitioning to a producer and will continue to execute Reed's disciplined and staged exploitation of Meekatharra's Mineral Resource and Reserve base targeting growth in gold production, longer life and lower costs."

Strategic appointment

Reed has also appointed Chris Mardon, who has more than 20 years of mining and resources experience, as general manager of the Meekatharra Gold Project.

Mardon has held senior management roles in resources companies including Modun Resources, Delta Gold, Croesus Mining and Tanami Gold/Jabiru Metals. He has also operated as an independent mining consultant.

He has held key roles in mine feasibilities, project development and management of mining operations both domestically and internationally.

Tonkin commented on the appointment: "Reed is fortunate to have attracted a mining professional of Chris's calibre after an extensive search.

"Chris has the appropriate skills, knowledge, experience, temperament, values and capacity to lead the Meekatharra team whilst establishing a strong foundation for Reed's growth in the Meekatharra region."

Path to production

Reed has ticked a number of boxes on the path to production at the Meekatharra Project, which hosts a 3.6 million ounce resource and 752,000 ounce reserve.

The company reached a decision to mine earlier this year and has since completed a $40 million underwritten entitlement offer and secured a $20 million debt facility with Barclays Bank.

The Meekatharra Project covers 1,000 square kilometres over 110 kilometres of strike within the fertile Wydgee Greenstone Belt.

It comprises six historically significant mining centres and multiple open pit and underground ore sources.

It is located in a region that has produced around 4.5 million ounces of gold and that hosts comprehensive infrastructure and facilities with an estimated replacement value of over A$100 million.

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