AngloGold Ashanti is set to process ore produced from Matsa Resources’ Red October gold mine in Western Australia, which is 60 kilometres from its Sunrise Dam operation.
The Sunrise Dam plant boasts a 3.8 million tonne a year capacity, providing Matsa with access to a nearby milling solution for its stage one production ore for a further 4.5 years thereafter.
Matsa purchased Red October from Saracen Minerals for $2 million in September 2017 when it had been placed under care and maintenance.
While the terms of the purchase agreement remain confidential, the costs and revenues of are entirely consistent with the parameters that have been established.
Matsa has previously delivered ore from its Fortitude and Red Dog gold mines in Western Australia to Sunrise Dam and said it is confident of the outcomes of the ore processed there.
The two gold producers also worked together to identify and develop gold deposits in 2018.
“The execution of the agreement with AngloGold Ashanti continues our strong relationship and builds on the memorandum of understanding both parties entered into in mid-2018,” Matsa chairman Paul Poli said.
“Previous mining campaigns at Fortitude and Red Dog have been successfully processed at Sunrise Dam with minimal fuss and we expect this to be no different.
“The fact that AngloGold are prepared to potentially accept all ore from Red October for up to five years is testament to this as Matsa looks to develop a longer term mine plan in the future.”
First delivery of ore to Sunrise Dam is scheduled to complete by June this year.