Evolution Mining has acquired the Crush Creek gold project in Queensland after inking an earn-in agreement with Basin Gold last year.
The Crush Creek project is 30 kilometres southeast of Evolution’s Mt Carlton operation, and has the potential to extend Mt Carlton’s mine life.
Crush Creek has been acquired for $4.5 million, with Basin Gold retaining a 10 per cent profit on gold production once it exceeds 100,000 ounces.
Evolution has fulfilled the requirement of the earn-in agreement by sole funding $7 million of exploration expenditure at Crush Creek.
Evolution vice president discovery and business development Glen Masterman said, “Drilling at Crush Creek has returned promising results and reinforces our belief that mineralisation we are delineating has the potential to extend mine life at Mt Carlton.”
The gold miner will continue drilling the Crush Creek prospects – BV7, The Kink and Gamma, during the December quarter.
Although Mt Carlton is considered one of Evolution’s smaller assets, it is one of the highest-grade open pit gold mines in the world.
Evolution started development of an underground project at Mt Carlton after encountering resource challenges at the site, where the bulk mineralisation tapered to a series of narrower structures at shallower depths than anticipated.
The company cut around 75,000 ounces of gold from its Mt Carlton life of mine plan earlier this year.
Further, the mine fell short of both its production and cost guidances during the 2020 financial year, producing 58,962 ounces at an all-in sustaining cost of $1453 per ounce.
Evolution expects to produce around 50,000 ounces at Mt Carlton during the current fiscal year.