Sandfire Resources provides a mineral resource update for its DeGrussa operations

Resource definition drilling in Conductor 5 and subsequent orebody remodelling in conjunction with a revision to modifying factors has resulted in a net overall increase in underground Ore Reserves of 0.4 million t and 2000 t of contained copper. After accounting for annual mining depletion of approximately 1.6 million t, mine life is supported through to mid 2022. Grade control drilling is ongoing at Monty with three underground (UG) diamond drill rigs currently operating. Mineral Resources and Ore Reserves will be updated in the second half of 2019 to incorporate these results. No material mining depletion has occurred at Monty up to 31 December 2018 therefore the Ore Reserves for Monty remain unchanged. Sandfire owns 100% of Monty following the acquisition of the 30% interest held by Talisman Mining Ltd in the Springfield Exploration and Mining Joint Ventures (refer to Sandfire’s ASX announcement titled, ‘Sandfire Completes Acquisition of Talisman’s 30% Interest in the Springfield Project’, dated 12 October 2018).

The DeGrussa processing plant has a capacity of 1.6 million tpy. The mining operations strategy adopted for the DeGrussa and Monty operations requires DeGrussa to supplement production from Monty. The updated underground Ore Reserves continues to support this strategy with DeGrussa mine production reducing to between 1.2 million tpy and 1.3 million tpy and mine production from the Monty Mine filling the mill capacity.

Ore Reserve Update

The DeGrussa Ore Reserve has been updated based on the December 2018 Mineral Resource model, annual mining depletion and revision to modifying factors. A successful resource definition drilling campaign during 2018 has provided the basis for an increase in the Mineral Resource in Conductor 5, part of which has been successfully converted to Ore Reserves and forms part of the current mine life. Unconverted Measured and Indicated Mineral Resources remain with ongoing technical and economic assessment being undertaken in conjunction with short-term mine design and planning activities. Those Mineral Resources that cannot be successfully converted to Ore Reserves at this last phase of mine design and planning will be subsequently sterilised. The unconverted Mineral Resources are distributed throughout all four orebodies. The DeGrussa underground mine Ore Reserve has been reduced by approximately 1.2 million t and 71 000 t of contained copper based on mining depletion, revision to modifying factors and an updated Mineral Resource model.

Mineral Resource Update

The DeGrussa Mineral Resource has been updated as at 31 December 2018 based on annual mining depletions, sterilisation and resource definition drilling. The resource definition drilling programme completed during 2018 has provided the basis to vertically extend the Conductor 5 Mineral Resource along the Shiraz Fault. This has resulted in a proportion being successfully converted to Ore Reserves. Mineral Resources for Monty are as outlined in Sandfire’s ASX announcement released in April 2016. Vigorous exploration programmes continue at Doolgunna with extensive programmes of AC, RC and diamond drilling continuing to test the prospective stratigraphy for mineralisation. Routine testing of geochemical and geophysical anomalism is also ongoing.

Sandfire’s Managing Director, Karl Simich, said the updated DeGrussa Ore Reserves reflected a net increase in underground Ore Reserves after mining depletion, underpinning a mine life which now extends into mid-2022.

“This is a positive outcome which reflects our continued success in replacing Ore Reserves and identifying extensions of some of the key VMS lenses at DeGrussa,” Simich said.

“Our exploration effort also continues unabated, with extensive programmes of air-core, RC and diamond drilling currently underway across our expanded footprint across the Greater Doolgunna District.

“Meanwhile, with the successful recent introduction of high-grade ore from the Monty Mine, we are expecting a strong finish to FY2019, with copper production tracking to hit or exceed the upper end of our guidance range at 68 000 t of contained copper. As Monty mining rates continue to ramp up into next year we will see the head grade increase and further boost copper production and cash flow,” he added.

Read the article online at: https://www.globalminingreview.com/mining/21062019/sandfire-resources-provides-mineral-resource-update-for-degrussa-operations/