Emerging gold producer Empire Resources is poised for ongoing cash flow after producing more than $2 million worth of gold from its maiden processing campaign at Penny’s Find gold mine in Western Australia’s Kalgoorlie-Boulder region.
In this first campaign, Empire Resources took 15 days to process 21,710 tonnes (t) of Penny’s Find ore at Golden Mile Milling’s nearby Lakewood Mill.
Preliminary figures from the campaign revealed about 1,500 ounces (oz) of gold were produced at a 94% recovery rate, including recouping 44% from the gravity circuit.
The calculated ore head grade was 2.38g/t gold from the initial operation. However, this is expected to be higher in upcoming campaigns as mining moves to the higher-grade part of the orebody.
With a further 16,000t currently being processed at the Burbanks mill south of Coolgardie, Empire Resources will be bringing in even more cash flow in the coming weeks.
In its first year of operation, Penny’s Find is expected to generate $7.6 million in free cash flow based on a A$1,500 per ounce (/oz) gold price. However, this doesn’t include $2 million in additional revenue for every $100/oz over the $1,500/oz base.
At today’s current spot gold price of A$1,642, Empire Resources stands to achieve quite a bit more than the original $2 million estimate for its maiden production.
“With a total average open pit grade of 4.62g/t gold to a depth of 80m, this project is providing an excellent production opportunity for Empire Resources, given the current sustained high gold price,” Empire Resources managing director David Sargeant said.
The company is also continually looking at ways to keep production costs down and is currently assessing different processing plants in the region.
With an approximate market capitalisation of $12 million, combined with the recently quashed 50% gold royalty hike that was proposed for WA miners, Empire Resources is well-placed to take advantage of the prevailing gold prices and establish itself as a reputed WA-based gold miner.