Matsa Resources Limited (Matsa) has just announced the results of a mining study completed at the company’s 100% owned Red Dog gold deposit.
The study shows that the mine will produce a cash surplus of A$5.4M over a period of three months which includes all mining and haulage of gold ore to AngloGold Ashanti Australia Limited’s (AGAA) Sunrise Dam Gold Mine (SDGM) treatment facilities.
The board of Matsa has also decided to commence mining at the Red Dog gold deposit as soon as possible. The capital and operating cash requirements of the mine will be funded by Matsa’s existing cash reserves, without the need to raise any additional capital.
The study shared that the mine has been predicted to only hold a short mine life (of three months), with one month for establishment prior to mining and is expected to generate a cash surplus of A$5.4M at a gold price of A$1,700 per oz.
“Red Dog project has the potential to be a near-term mining opportunity, with Matsa’s Fortitude mine infrastructure only 25km to the east and the Red October camp and accommodation infrastructure, including haul roads only 20km to the north,” commented Matsa Resources.
Red Dog, (which was previously named Tin Dog) was first discovered by Whim Creek Consolidated in 1984. The project is set to occur within the Archaean greenstone belt, consisting of a predominately intermediate to mafic volcanic-sequence with interbedded sediments and Banded Iron Formations (BIF).
AngloGold Ashanti have been allocated to buy all ore produced through an ore purchase agreement with ore treated at SDGM. Currently, all statutory and regulatory approvals are in place for the mine, and contracts for mining and haulage are being finalised.
Mining activities are set to commence in early August, with mining activities expected to be completed within 15 weeks from commencement.
More information on this can be accessed here.