Blackham Resources' (ASX:BLK) shares have jumped almost 165% since the beginning of this year as the company continues its drive towards restarting the Matilda Gold Project, in the Northern Yilgarn, Western Australia.
Matilda could be restarted in late 2015 - and the project could be cash flow positive within five months of the development decision.
Initial Capex is estimated at $24.6 million while all-in sustaining cash costs are between A$1,000 to A$1,100 per ounce.
Earlier this month, the company defined a maiden open pit Resource estimate of 280,000 ounces of gold for the Bulletin South deposit.
This increased total resources located within 20 kilometres of the wholly-owned 1.3 million tonnes per annum gold plant to 44 million tonnes at 3.3 grams per tonne for 4.7 million ounces of gold.
Open pit mining studies are now underway for the Bulletin, Happy Jack, Squib and Golden Age North deposits with a view to extending the mine life.
These have resources totalling 3.5Mt at 3.4g/t for 376,000 ounces of gold and sit outside the initial mineral inventory of 5Mt at 2.8g/t for 454,000 ounces of contained gold.
Blackham is currently carrying out a 4,000 metre reverse circulation drill program designed to grow mine life at the project. Notably, the contractor has agreed to a 20% payment of the consideration in BLK shares valued at $0.09 each.
Drilling will follow up on successful previous intercepts by testing down-plunge extensions with the aim of increasing the resources within open pit limits.
This is in line with the company's focus on free-milling gold targets and resources within open pit or shallow underground depths and in close proximity to the WGP plant and infrastructure and capable of being bought into the front of the mine plan.
- Revision of the Matilda Mine resource to include additional drilling over the last 18 months;
- Improvements to Matilda economics due to potential reduction in mining contractor rates; and
- Additional open pit resources to extend mine life.
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