Alkane Gets Go Ahead for Tomingley Gold Mine, New Drill Results Enhance Potential for Expanded Resource
February 11, 2013 (Source: Alkane Resources) — Multi commodity miner and explorer, Alkane Resources Limited (ASX: ALK), has today been granted a mining lease from the NSW government for the Tomingley Gold Project (TGP) near Dubbo in central west NSW.
This enables TGP development to proceed immediately and follows earlier development approval in July 2012.
Alkane today has also released new drill results from the Caloma Two section of the project, indicating an expanded resource and potentially longer mine life.
First gold output from Tomingley is anticipated late 2013 following an 11 month construction period.
A recent review of the planned mining operation, based on the existing resource but excluding the Caloma Two discovery, shows that from gold production of 380,000 ounces, cash cost excluding state royalties of A$980 an ounce and a gold price of A$1,600 an ounce, TGP would generate EBITDA of A$217 million over a seven year life.
Alkane in 2011 entered into a 90,000 ounce gold forward sale from TGP which underwrites a minimum price of approximately A$1,600 an ounce for the first two and a half years of production.
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The latest RC drilling results from the Caloma Two deposit within Tomingley have shown grades ranging from 2.78g/t to 9.59g/t over substantial widths.
Alkane sees significant upside at Tomingley from:
- the recent discoveries at Caloma Two
- extensions to underground mining at Wyoming One and
- further expansion of the Caloma open pit and underground.
In March Alkane expects to submit to the NSW government an environmental impact statement for the Dubbo zirconia and rare earths project (DZP), from which production is expected in early 2016.
Alkane’s two forthcoming projects, TGP and DZP, will create around 900 jobs across construction and operations and involve capital expenditure over the next two years of approximately A$1 billion.
For a copy of today’s ASX announcement from Alkane click here
For a copy of the NSW government release click here
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