MEEKATHARRA - GOLD
The Meekatharra gold project, which is located in central Western Australia, is a wholly owned entity of Reed Resources Ltd and was acquired in January 2011.
The project represents a tenement holding of almost 1000km2 and resides within the Murchison District of Western Australia. This area of Greenstones is host to multiple multi-million ounce deposits such as Mt Magnet (8Moz production) and Tuckabianna (1Moz production). At the time of acquisition (January 2011), the project included resources of 2.5Moz @ 1.7g/t, reserves of 500koz @ 3.5g/t and key infrastructure which includes a 3Mtpa processing plant, a 200-man camp, offices and a 7MW diesel power plant with a replacement value >A$100 million.
Project History
The Greenstones within the tenement package host several deposits with proven historical production in excess of 1Moz. Paddys Flat near Meekatharra has historical gold production of 2.3Moz, the Bluebird mining centre has produced 1.2Moz and the Reedy Mine has produced 1Moz.
Underground mining was largely historical (pre 1950’s) with most modern mining (post 1980) being undertaken through open pits exploiting the shallow resources.
Metana Minerals, St Barbara Mines and Mercator Gold were the previous owners of this tenement holding and equipped the site with infrastructure to support a 200 man workforce and a mill capable of processing up to 3MTpa. This infrastructure was included in the acquisition.
Project Geology
The geology within this Greenstone sequence is variable, complex and has been intensely structurally deformed by both intruding granitoids and by tectonic events. This has provided an extensive plumbing system for gold bearing fluids to exploit. As such this project hosts a widespread suite of varying mineralisation styles from massive stock-work orebodies to narrow high grade vein style deposits.
Strategy
Resources at time of acquisition of 2.5Moz and 0.5Moz reserves were last calculated at a gold price of $750-$800/oz. Since acquisition, the mining and geology team have re-modelled and re-optimised the main resources at current economics with a view to targeted resource conversion and expansion. A feasibility study and mining plan has been developed to exploit multiple ore-streams from multiple sources, reducing the mining risk and allowing sustainable mining and exploration within the Murchison District and bolstering Reed Resources vision to becoming an Australian Mid-tier gold producer.
Stage 1 will focus on the Yaloginda region which has produced one and half million ounces to date. In the first 23 months 134,000 ounces will be produced from four low risk open pits - Bluebird, Batavia, Whagamata and Surprise, all within 6.5km of the Bluebird mill.
Stage 2 will exploit the remaining 618,000 ounces of Reserves and will see the focus expand from open pit to open pit and higher grade underground production at Paddy's Flat to the north and Reedys to the south in addition to ongoing operations at Yaloginda.
Stage 3 of Reed's strategy will be executed concurrently with Stages 1 & 2 and will utilise the latest targeting and exploration techniques to convert as many of the remaining 2.8 million ounces of resources to Reserves whilst also defining additional Resources and Reserves.
Summary of Current Mineral Resources as at 30 June 2012
| Project | Resource Classification | Tonnes | Gold Grade (g/t) | Total Ounces |
|---|---|---|---|---|
| Meekatharra North | Indicated | 1,164,200 | 1.8 | 65,700 |
| Inferred | 184,600 | 1.6 | 9,300 | |
| Sub-Total | 1,348,800 | 1.7 | 75,000 | |
| Paddy's Flat | Indicated | 25,231,700 | 1.6 | 1,280,687 |
| Inferred | 13,389,000 | 1.6 | 670,034 | |
| Sub-Total | 38,620,700 | 1.6 | 1,950,722 | |
| Yaloginda | Indicated | 10,049,000 | 1.7 | 563,603 |
| Inferred | 6,291,000 | 1.7 | 346,877 | |
| Sub-Total | 16,340,000 | 1.7 | 910,480 | |
| Nannine | Indicated | 611,000 | 1.6 | 30,900 |
| Inferred | 243,000 | 1.6 | 12,700 | |
| Sub-Total | 854,000 | 1.6 | 43,600 | |
| Reedys | Indicated | 2,740,000 | 3.1 | 276,401 |
| Inferred | 3,955,000 | 2.7 | 337,859 | |
| Sub-Total | 6,695,000 | 2.9 | 614,260 | |
| TOTAL | Indicated | 39,795,900 | 1.7 | 2,217,291 |
| Inferred | 24,062,600 | 1.8 | 1,376,770 | |
| TOTAL | 63,858,500 | 1.8 | 3,594,062 |
Summary of Current Ore Reserves as at 30 June 2012
| Type | Project | Reserve Classification | Tonnes | Gold Grade (g/t) | Total Ounces |
|---|---|---|---|---|---|
| Open Pit | Bluebird | Probable | 1,390,000 | 1.9 | 86,200 |
| Prohibition | Probable | 1,110,000 | 2.7 | 96,000 | |
| Mickey Doolan | Probable | 3,312,000 | 1.1 | 121,700 | |
| Maid Marion | Probable | 192,100 | 1.4 | 8,650 | |
| South Junction | Probable | 97,000 | 1.5 | 4,500 | |
| Surprise | Probable | 136,000 | 3.0 | 13,000 | |
| Batavia | Probable | 200,000 | 2.4 | 14,000 | |
| Whangamata | Probable | 258,962 | 1.4 | 11,900 | |
| GNH | Probable | 880,000 | 1.3 | 35,600 | |
| Aladdin | Probable | 383,700 | 1.7 | 21,450 | |
| Jack Ryan | Probable | 222,500 | 3.1 | 21,800 | |
| Callisto | Probable | 72,500 | 3.1 | 7,200 | |
| Rand | Probable | 100,000 | 2.4 | 7,600 | |
| South Emu | Probable | 91,100 | 4.7 | 13,900 | |
| TOTT | Probable | 505,000 | 1.8 | 29,400 | |
| Sub-Total | Probable | 8,950,862 | 1.7 | 492,900 | |
| Underground | Prohibition | Probable | 1,325,260 | 2.4 | 104,100 |
| Vivian/Consols | Probable | 256,500 | 7.7 | 63,600 | |
| Fatts/Mudlode | Probable | 380,000 | 4.7 | 57,200 | |
| South Emu | Probable | 249,700 | 4.3 | 34,200 | |
| Sub-Total | Probable | 2,211,460 | 3.6 | 259,100 | |
| Meekatharra Package - TOTAL | 11,162,322 | 2.1 | 752,000 |
*All reserves quoted at a gold price of AUD$1,300
2013-02-27 21:28:36
NEWS FLOW...
April 19, 2013
Hedge book closure yields $27 million - All debt retired
- $27 million cash realised on closure of hedge book.
- Credit Suisse debt facility to be fully repaid and group security released.
- Company cash balance to increase by $7.7 million.
- Meekatharra Gold Operation continues to be economically viable at current gold price.
- Bluebird Mining Operations to continue as planned.
March 26, 2013
Meekatharra Gold Operation Update
- Bluebird open pit continues to exceed production budget
- Gold produced from the Bluebird open pit continues to exceed budget
- Planned mill throughput rate achieved early
- Bluebird mill achieving budget mill recovery of 94%
- Gold produced as budgeted
- Unit cash costs materially meeting budget
February 25, 2013
Meekatharra Gold Operation Official Opening
Reed Resources Ltd is pleased to announce that its Meekatharra Gold Operation was officially opened today by the Hon. Norman Moore MLC, Minister for Mines and Petroleum, Fisheries and Electoral Affairs, and Leader of the Government in the Legislative Council.
More...January 11, 2013
First gold pour at Meekatharra Gold Operation
Commissioning of the elution and gold room circuit at the 3Mtpa Bluebird Gold Processing Plant at the Meekatharra Gold Operation has culminated with the pouring of Reed’s first gold bar from Bluebird.
More...December 20, 2012
Plant Wet Commissioning - Meekatharra Gold Operations
Initial plant feed blend predominantly comprises stockpiled, low grade ore which will establish Bluebird’s gold in circuit inventory of approximately 1,200 ounces.
Gold production is scheduled to increase throughout the March quarter of 2013.
More...November 28, 2012
Revised - Debt Financing Facility Announcement
- Credit Suisse and Reed execute A$19 million debt finance facility agreements; funds available for immediate drawdown.
- Participating Forward hedge to provide floor price of approximately A$1626/oz for hedged ounces.
- Commissioning of Meekatharra Gold Project on schedule to begin in December.
September 30, 2012
Mining Contract Awarded - Meekatharra Gold Project
Minepower awarded Meekatharra Gold Project Mining Contract
Mr Chris Mardon appointed General Manager – Meekatharra Gold Project
More...September 27, 2012
$19M Debt Facility to fund the development of the Meekatharra Gold Project
Credit Suisse to act as arranger to provide $19M in debt finance.
Credit approved term sheet signed for a debt and hedging facility for the Meekatharra Gold Project.
More...July 17, 2012
Contracts Executed - Meekatharra Gold Project
Crusher Installation and Power Supply Contracts Awarded.
More...July 11, 2012
Financing Announcement - Meekatharra Gold Project
Reed is pleased to announce the receipt of a Commitment Letter from Barclays confirming credit approval for the debt facility and mandatory hedging program.
Commitment Letter confirms credit approval of $23m revolving credit and performance bond facilities.
The commitment is subject to conditions including execution of formal documentation and completion of final due diligence.
More...May 25, 2012
Construction and Financing Update - Meekatharra Gold Project
~$40m underwritten Rights Issue closed.
Mandate for $23m debt and hedging facility signed with Barclays.
70,000oz of gold put options (A$1,560 strike) purchased.
Plant refurbishment on schedule and within budget.
More...April 30, 2012
Debt Funding - Meekatharra Gold Project
Barclays Bank PLC have been mandated to act as arranger in providing finance of up to $23 million for the Meekatharra Gold Project by way of a $20 million Revolving Working Capital Facility and a $3 million Performance Bond Facility.
Together with Reed’s $40 million underwritten rights issue, the working capital facility will provide the funding required for ongoing production and general development activities at Meekatharra.
More...April 24, 2012
Luke Tonkin appointed Managing Director
Luke Tonkin joins Reed Resources as Managing Director.
Adds significant corporate and operational experience to Reed Resources ahead of planned production at the Meekatharra Gold Project in December quarter 2012.
Chris Reed moves to Executive Director to focus on business development and nongold asset optimisation.
More...April 5, 2012
Boardroom Radio Interview
Chris Reed discusses some of the details of the current capital raising as well as what the funds will be used for and to what stage they will take the Meekatharra Gold Project.
Direct link: http://www.brrmedia.com/event/95875
More...April 2, 2012
$40 Million Underwritten Entitlement Offer
A$40 million equity raising offer to shareholders.
Funds committed to the development of the Meekatharra Gold Project.
Offer fully underwritten.
Offer due to open on 17 April 2012.
More...March 21, 2012
Meekatharra Gold Project - Resource Increase
Reed Resources adds 283,000 ounces of gold to its flagship Meekatharra Gold Project, taking the total gold resource to 3.59 million ounces. The increase was made up of the following:
- Magazine-Grants trend adds 194,600 Maiden Resource Ounces
- Five Mile Well adds 39,900 Maiden Resource Ounces
- Boomerang Deeps adds 48,500 Resource Ounces
February 29, 2012
BoardRoom Radio Webcast
Chris Reed discusses the recently released results of the Meekatharra Gold Project Bankable Feasibility Study, risks, potential returns and strategy moving forward.
Direct link - http://www.brrmedia.com/event/94063
More...February 27, 2012
Decision to mine - Meekatharra
Bankable Feasibility Study for Meekatharra Gold Project completed.
Reed Board makes decision to mine, subject to equity and debt financing arrangements.
Stage 1 (95,000 oz pa) is a low-risk multiple open pit mine plan, targeting first gold in DecQ 2012.
Direct Construction, Pre-commissioning Mining and Owners Costs – A$35.5m
More...January 19, 2012
Gold reserves increased by 40% to more than 750,000oz
Total Reserves (including underground) increased 40% to 750,800oz of gold
Open pit Reserves increased 59% from 308,000oz to 491,700oz
Bankable Feasibility Study on schedule to be delivered in February
Finalisation of Paddys Flat ‘Super Pit’ optimisation imminent
More...January 11, 2012
Key appointments to support production and expansion at Meekatharra Gold Project
Reed Resources Ltd has bolstered its management and operations team with the appointments of Mr David Lim as Chief Financial Officer, Mr Geoffrey Cheong as Processing Manager, and Mr Kenneth Fairless as Maintenance Superintendent.
The appointments further expand the management and operations experience of Reed Resources and strongly position the Company to bring its flagship Meekatharra Gold Project back into production in late 2012.
More...November 15, 2011
Meekatharra - Resource and Reserve Upgrade
Total Resources increase by 498,000oz to 3.27Moz.
Open pit Reserves increase by 18% from 251,000oz to 308,800oz.
Total Reserves (including underground) now stand at 533,700oz.
New open pit Reserves strengthen a robust mining plan.
More...September 9, 2011
Meekatharra - Underground Gold Reserve
Total underground Probable Reserves of 1.96Mt @ 3.6g/t for 225,000oz.
Underground mining plan completed accessing five ore bodies from existing single decline.
More...August 29, 2011
Meekatharra - Project Update and Drilling Results
Key Bankable Feasibility Study work packages for recommencement of production are ahead of schedule.
A mine plan to produce ~120,000 ounces pa from 1.5Mtpa of open pit/underground ore is nearing completion.
Work has commenced on optimisation of a ’Paddys Flat Super-Pit‘.
A successful maiden drilling campaign has yielded results including:
- 3m @ 2.15g/t Au, 5.0 g/t Ag and 1.1% Cu intersected at Chunderloo
- 3m @ 5.84 g/t Au and 2m @ 4.4 g/t Au intersections outside Batavia reserve
- 10m @ 2.45 g/t Au intersection extends strike length at Whangamata by 300m
- 1m @ 142 g/t Au intersected at new prospect, Sirdar.
July 6, 2011
Meekatharra - Secures Adjoining Nannine Project
Option secured to acquire outright ownership of the Nannine Mining Centre.
Opportunity to extend Reed Resources’ Meekatharra land holding to a 110km long continuous land package from Reedy to Meekatharra North.
Land holding of 147km2 to potentially add to existing 800km2 endowment.
Historical mining at Nannine has produced over 200,000oz from pits and high grade underground.
Existing resources of 580,000t @ 3.2g/t for 59,000oz.
More...July 1, 2011
Completion of Meekatharra acquisition and commencement of drilling
Settlement of the Meekatharra Gold Project acquisition to occur today.
Commencement of Resource extension and exploration RC drilling:
- Diamond drilling for geotechnical and metallurgical information to commence on 12th July at the 600,000oz Mickey Doolan resource;
- Targets include Chunderloo copper-gold, Bluebird and Paddys Flat.
June 22, 2011
Underground Resources Increased at Meekatharra Gold Project
Re-interpretation of the Vivian-Consols-Mudlode-Fatts ore system completed.
Resource estimate by Snowden increases the global resource from 1.78Mt for 318,000oz to 1.77Mt for 373,000oz, due to a 17% increase in grade.
Underground reserve and mine design in progress on new model.
Recommencement strategy to include underground operations.
More...May 26, 2011
Meekatharra Gold Reserves Increased by 96,000oz
New open-pit reserve at Prohibition of 1.11Mt @ 2.7g/t Au for 96,000oz.
Since acquisition open-pit reserves have been increased by 137,000oz, or 32%, to 250,000oz, with Total Reserves now at 559,000oz.
New Underground mine plan at Paddys Flat to commence in June – current Reserve 1.99Mt at 4.8 g/t Au for 308,000oz.
Metallurgical drilling and optimisations to commence on the 600,000oz Mickey Doolan/Phar Lap resource.
More...May 5, 2011
Resources-Reserves Increased as Project Progresses Ahead of Schedule at Meekatharra
Resource increase at three deposits within Project:
- Prohibition Resource INCREASED by 2.8MT for an additional 158,000oz
- Surprise and Jess identify additional new Resources of 40,000oz
Reedys first open pit Reserve since 1997 of 36,600oz has been completed on Jack Ryan, Rand and Callisto Pits at a gold price of A$1300/oz.
Mickey Doolan and Prohibition pit optimisations commence.
Resource-Reserve and exploration drilling planned to commence in July.
Project progressing ahead of schedule.
More...March 31, 2011
Updated Gold Resource and Reserve Estimates at Meekatharra Project
New Bluebird Reserve of 1,410,000t @ 1.92g/t for 87,000oz represents base load feed for first year's planned gold production.
Resource/Reserve extension drilling planned for landbridge between Bluebird and South Junction Pits and infill drilling of Inferred Resources within the current pit shell.
New Rand Resource completed by Snowden has 10% higher grade and increases contained ounces 23% to 233,000oz.
Remodelling of Prohibition, Surprise, South Emu and Whangamata are well advanced.
Resource definition drilling planned for Yaloginda and Paddy's Flat as part of a near mine expansion project.
More...March 17, 2011
Reed uncovers high grade copper-gold at Meekatharra
High grade intersections around historic Chunderloo Copper Mine.
Chunderloo copper-gold-silver target includes intersection of 15m @ 14.7g/t Au and 4.1% Cu (including 7m of 28.9 g/t Au and 8.3% Cu).
Numerous geochemical and geophysical targets over 1.5km strike.
More...March 11, 2011
Meekatharra Gold Project Update and Mineral Resource Estimate
Successful first steps in ‘grade focussed’ strategy for Meekatharra.
Re-estimation of Resources at Jack Ryan boosts overall grade by 34%.
Completed the first Resource estimate at Callisto Project since mining ceased in 1997.
Re-interpretations at the Rand, Prohibition, Surprise and Vivian-Consols deposits is in progress.
Re-optimisation of Reserves at Bluebird at current gold prices is underway.
Key consultants engaged to assist with the re-starting of the Meekatharra project.
More...February 24, 2011
Reed to raise $40 million through Placement and underwritten Share Purchase Plan
$30 million Placement to sophisticated and institutional investors in two tranches.
$10 million underwritten Share Purchase Plan to existing shareholders.
Funds raised to be applied to the acquisition of the 2.5M Oz Meekatharra Gold Project and to supplement existing working capital.
The Placement was heavily oversubscribed, demonstrating strong investor interest in the Company’s gold, lithium and vanadium assets.
More...January 11, 2011
Reed Resources acquires 2.5Moz Meekatharra Gold Project for A$28 Million
Reed Resources to acquire 100% tenements and assets held by Mercator Gold Australia Pty Ltd for $A26.7 million and 2 million Reed Resources shares.
Key asset, Meekatharra Gold Project, totals >800 km2 of granted tenements, with JORC Code compliant gold Resources of 2.5Moz and 0.42Moz in Reserves, with significant expansion potential
Key infrastructure includes 3Mtpa processing plant, a 200-man camp, offices and a 7MW diesel power plant with a replacement value >A$100 million.
Acquisition strategically positions the Company to create a mid-tier gold producer and is part of a broader strategy to consolidate, incubate and potentially “spin - out” its gold assets into a new company.
More...January 10, 2011
Trading Halt
The Company anticipates being in a position to make an announcement regarding the acquisition prior to the commencement of trading on Thursday, 13 January 2011.
More...